This report examines the place of children in the employment-based health insurance system. The report, which uses data from three national studies conducted by the Federal Government between 1977 and 1990, estimates the number of children who are uninsured or underinsured and examines the decline of children's private insurance coverage between the late 1970s and late 1980s. The first section of the report discusses racial and ethnic characteristics of children without employer-based insurance, insurance coverage among children living in families, and the role of Medicaid. The second section reviews insurance coverage among minority children, and trends in insurance coverage of children in terms of family income level, parents' employment status, and place of residence. Tables presenting data relevant to these topics are provided. It is concluded that a national health program that assures access to health care for all children is needed. A national health plan should have three components: (1) access to health insurance for all families; (2) funding for the development of health services in areas suffering from a shortage of primary health care; and (3) the maintenance of a basic public health infrastructure. Technical notes concerning the three studies upon which the report is based are appended. (BC)