Many states have expanded eligibility for, and simplified access to, the children's Medicaid program. This has helped shrink the number of uninsured children from 6.9 million in 2008 to 5.9 million in 2010. Experts say the Affordable Care Act, the federal health care overhaul that requires states to maintain income eligibility levels and discourages other barriers to coverage, has played a key role in the improvement.
Overall, 34 states had a significant decrease in the rate of uninsured children.
Florida made the most progress, dropping from 667,758 to 506,934 during that time period, although the state still has one of the highest rates of uninsured children in the nation.
Minnesota, Kansas and Wisconsin saw an increase in the number of uninsured children.
Nevada has the highest rate of uninsured children while Massachusetts has the lowest, according to the report.
The findings are based on an analysis of new health insurance data from the Census Bureau. It was done by the Georgetown University Health Policy Institute's Center for Children and Families.
The news comes as the number of uninsured adults has risen in the past few years.
High unemployment rates and the increasing cost of private insurance are driving more families to the federal-state Medicaid and Children's Health Insurance Programs, also known as CHIP. Both programs provide health insurance for children, but come from different funding streams and allow states more flexibility in how they run their programs.
President Barack Obama signed an extension of CHIP and provided $87 billion to help states pay for Medicaid in the 2009 economic stimulus, and experts say a bipartisan national commitment aimed at covering children has given states new tools and incentives to follow through. For example, some states once required face-to-face interviews; now many states have online applications.
The Affordable Care Act should also help preserve these gains going forward, said Joan Alker, co-executive director of the Georgetown University research center.
"We will move to a culture of coverage. The presumption is everyone has insurance," she said. "Families will feel there's an option out there for them."
The Supreme Court has agreed to hear arguments challenging the constitutionality of the historic health care overhaul next year.
Florida led the nation in reducing the number of uninsured children, in part because the state's Medicaid rolls swelled as the economy soured. But legislation passed in 2009 has also simplified the process and reduced penalties for those who don't pay premiums.
South Carolina is trying to make it easier for low-income children who already qualify for health care coverage to enroll in Medicaid. The state's Medicaid director is requesting an additional $35 million from the state for next year's budget. Nearly $30 million of that would pay to add an estimated 70,000 children to Medicaid rolls by streamlining the application process.
While Tuesday's report is promising, experts worry that increased enrollment may be difficult to sustain as state lawmakers slash budgets, especially for big-ticket expenses such as health care.
"These gains are fragile and could quickly be reversed if state or federal support erodes," Alker said.
More than 128,000 children are on the waiting list in Arizona after officials froze their KidsCare program enrollment in 2010 to help balance the state budget. The program now has approximately 15,000 children — down from 45,820. The state recently submitted a two-year plan for federal approval that would allow enrollment of 19,000 children now on a waiting list.
Still, Arizona was able to drop from 258,339 uninsured children in 2008 to 207,967 in 2010, according to the report.
Wisconsin state officials are looking to move 215,000 Medicaid-eligible children into a stripped-down version of the program with reduced benefits.
Texas also decreased the number of uninsured children, but some health advocates fear major state cuts to address that state's massive budget crisis. In 2003, when the state was facing a smaller shortfall, more than 200,000 children were kicked off of the Children's Health Insurance Program.
Minnesota saw the largest increase in uninsured children, jumping from 72,493 in 2008 to 84,165 in 2010, according to the report.
For years, Minnesota has operated under a federal waiver that differed from other states. The waiver said that children eligible for the state's insurance program were not also eligible for the federal program, meaning the state lost out on enhanced matching funds. In the past several years, the state has made cuts. For example, the program used to allow children born on Medicaid to remain on the program until age 2 regardless of circumstances. Now a child can remain until age 1, Berglin said.
The state has attempted improvements such as creating gap coverage between Medicaid and Minnesota care, but the federal government didn't sign off, she said.
"Doing the things that other states have done is more costly for Minnesota," said former Minnesota Sen. Linda Berglin, a longtime champion of health care services. "It makes me sad. Obviously I believe having all children insured is a goal we should be striving for. If we are going to implement federal reform that will take care of a lot of the problem."