High-Risk Insurance Pools Open To People 'Locked Out' Of Market

People who have been unable to obtain health insurance in the commercial market because of pre-existing conditions can apply for a new, federally funded high-risk insurance pool beginning Thursday, The Wall Street Journal reports. "The program is the first major plank of the health overhaul signed into law in March, and it's designed as a temporary provision to expand coverage until 2014, when a requirement kicks in that insurers accept all applicants." Twenty-one states will allow people to apply for a federally-run pool, while 29 states and the District of Columbia will run their own pools (Adamy, 7/1).

"The Pre-existing Condition Insurance Plan will provide coverage to as many as 350,000 individuals. It will bridge the coverage gap until the Affordable Care Act goes into effect in 2014," CNN reports. Health and Human Services Secretary Kathleen Sebelius said, "For too long, Americans with pre-existing conditions have been locked out of our health insurance market" (Young, 7/1).

Joining the pool, however, will not be cheap, The Associated Press reports. Monthly premium prices will range by state and plan design from $140 to $900, a government official tells the AP. "The price range is so wide because premiums will be keyed to standard individual health insurance rates in each state, which can differ dramatically because of medical costs and the scope of coverage. Independent experts estimate premiums will average around $400 to $600 a month. Younger people will pay less." Even very high premiums, however, may be attractive to people who are otherwise unable to obtain any insurance (Alonso-Zaldivar, 7/1).

Los Angeles Times: Also, there may not be enough money to cover everyone who might benefit from the program. "The new healthcare law allocated $5 billion for the new high-risk pools, but several independent analyses, including one by the nonpartisan Congressional Budget Office, have estimated that more money would probably be needed because demand will be so high. The Department of Health and Human Services will be able to shift money from states that are not using all their allotted funds to those that need more, but so far administration officials have been reluctant to talk about seeking more funds" (Levey, 7/1).

The Miami Herald: "Officials conceded that not everybody who needs the plan will be able to afford it, and that plan enrollment might have to be limited and premiums, deductibles and co-payments might have to be raised if -- as critics predict -- the $5 billion is not enough." For those who can afford it, it will be a great, great plan,'' said Richard Popper, an administrator with the Office of Consumer Information and Insurance Oversight," a health department office (Tasker, 7/1).

CongressDaily: Some of the 29 states and the District of Columbia are still working out details of their plans. "Oklahoma Insurance Commissioner Kim Holland said her department was still negotiating the final details of their contract to run a high risk pool with HHS, and that the short timeline her department had to set up the program was challenging. 'This is not just a burden on states, but also on HHS,' said Holland, who also serves as secretary-treasurer of the National Association of Insurance Commissioners. 'We are doing the best we can with what we have'" (McCarthy, 7/1).

San Francisco Chronicle: California is also facing delays. "The Obama administration hoped the new federal high-risk pools would be up and running by today, about 90 days after the president signed the health reform measure into law, but California and many other states have encountered complications that made the timetable unrealistic. California now expects its program to begin in September, with signups starting next month" (Colliver, 7/1).

The (New Orleans) Times-Picayune: The federal government, however, will begin accepting applications for the program it will run in 21 states today, even though consumers still have little information about the plans. Sebelius "praised the Pre-Existing Condition Insurance Plan in a written statement Wednesday, but her office has released only generalities about what the policies will cover, how much they will cost and when they will go into effect. HHS also did not identify the carrier that will administer the plan. Sebelius' agency said it will release information for potential consumers today on its website, where an online brochure will be available" (Barrow, 7/1).

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