Between now and 2014, the government will establish high risk pools for individuals who are not able to obtain private health insurance. See High Risk Pools.
Once the health insurance exchanges are up and running, the pools are replaced by enrollment in a plan of choice through a health insurance exchange. Once enrolled in an exchange plan, high risk individuals will pay the same premiums as everyone else. The law also requires that premiums within the high risk pools must be the same as standard coverage. This is the primary reason for the $5 billion in the law to pay for these pools. High risk pools are not new, 35 states have such pools, but they are expensive, so expensive some states have limited enrollment.
Clearly individuals such as those utilizing current high risk pools are entitled to health insurance, but Americans should also realize what it means to merge high risk individuals into the general insurance market. It means that costs for those insured in the individual market will see an (perhaps significant) increase in their premiums. Including high risk individuals in general risk pools is not new, employer plans have been including all employees and their dependents with little or no risk consideration and limited waiting periods for many years.
Is this the right thing to do, yes. Is it consistent with making insurance affordable for all Americans especially those with health insurance today, not necessarily. Over time as coverage expands, this will become a non issue, but because we have done little to address the underlying cost of health care, expectations for the illusive “affordable” health care must be tempered.
Also, take a look at the reasons high risk individuals are rejected for standard coverage, how many of these can be affected by life style including such simple things as weight management, exercise and eating habits. In many ways we are our own worst enemy.
The following relates to the Wisconsin high risk pool and is taken from The Cap Times, Your Progressive Voice
The Government Accountability Office has estimated that there are 4 million uninsured Americans with health problems that could benefit from enrollment in the pools.
Most members [of the Wisconsin high risk pool] have one or more conditions that have led to them being rejected by insurers in the individual market or to being offered policies at unaffordable rates. An informal sample of hundreds of recent HIRSP applications found that the top 10 health problems listed by applicants included, in order of predominance, high blood pressure, obesity, high cholesterol, diabetes, cancer, heart problems, arthritis, sleep apnea, depression and tobacco use.
A typical person in the pool pays $656 a month for a HIRSP policy with a $2,500 deductible.
A study conducted by the Henry J. Kaiser Family Foundation found that coverage for plans offered by the 35 states with such high-risk pools typically costs 25 to 100 percent more than the standard market rate for health insurance.
Even with high rates, though, none of the programs offered across the country can pay for themselves through premiums alone, primarily because they serve a high health-risk population that requires more medical care than most. In 2008, more than $2.01 billion was spent on 199,020 high-risk pool enrollees nationwide, according to the Kaiser study. The average claim cost per enrollee was $9,437.
In Wisconsin, premiums fund about 60 percent of the program’s operating costs. A significant portion of the rest is financed by health insurance providers, who pay an assessment on policies sold in the state, which generated $27.5 million last year, or about 18 percent of HIRSP’s $155 million operating budget, according to Goldman. The rest is funded through discounts offered by health care providers.
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