Expanding Coverage For People With Health Conditions
One of the provisions of the new health care reform law is $5 billion in federal funding for high risk pools, set to begin operating this summer, that will provide health insurance for people with pre-existing conditions who don’t currently have health insurance. This is intended to be a stop-gap until 2014, when high risk pools will presumably no longer be necessary, since private health insurers will have to begin accepting all applicants in 2014.
Although there are currently some states that have no high risk pool coverage at all, we’re lucky here to have Cover Colorado. Cover Colorado is a high risk pool option for people who have been declined by a private health insurer, or who have been offered coverage with a pre-existing condition exclusion or an initial rate increase that makes the private policy more expensive than Cover Colorado.
States like Colorado that already have high risk pools will still be able to participate in the new risk pool program, and will be able to set up a new pool with the federal money. But the new program would require that the risk pool premiums be the same as the average rates in the private health insurance market, and would also require that a person have been uninsured for at least six months before enrolling in the risk pool. Cover Colorado currently offers premium subsidies to people with household incomes under $50,000/year, but the premiums are still typically more than the average rate in the private health insurance market. In addition, Cover Colorado allows an applicant to transition directly from another policy (COBRA that is ending, or another state’s high risk pool, for example) to Cover Colorado, with no gap in coverage.
The details of the program are described in the Senate Bill, starting on page 41, in the section titled “Subtitle B—Immediate Actions to Preserve and Expand Coverage” (section 1101). One of the requirements for a state to participate in the new risk pool program is that the state may not cut funding that it normally spends on its current risk pool: “a State shall agree not to reduce the annual amount the State expended for the operation of one or more State high risk pools during the year preceding the year in which such contract is entered into.” So I assume that Cover Colorado will continue to receive its current funding, and the new program will provide additional access to health insurance for people in Colorado who have pre-existing conditions. The new law also has a provision (subsection e) that prohibits insurers or employers from encouraging a sick person to drop existing private health insurance in order to switch to the risk pool coverage. So hopefully the risk pool program will truly serve to expand access to care rather than just shuffle high-cost insureds from one policy to another.
Louise:
Thanks,for discussing this important topic. At a time of transition when, in light of Health Insurance Reform, CoverColorado seems to be re-dfining its mission; participation in the federal High Risk Pool program would give them a much needed, albeit short-term, focus. Using federal funds to offer a product rated at “market rates” would be most helpful to Colorado consumers who cannot find individual coverage because health conditions.
A bigger question for CoverColorado is how they envision their role in 2014 and beyond. Although logic might say that they have no role, I’m not so sure they aren’t planning a survival strategy. If you were in their shoes, wouldn’t you?
Jim,
Good discussion point. I can see all sorts of roles for Cover Colorado in 2014 and beyond. Our experience with them has been that they are a solid organization and I think that they will continue to exist with with a different focus. I could see them partnering with the state to serve a larger Medicaid population once the eligibility for Medicaid is expanded. I imagine that they will continue to be part of the state-run health insurance system, rather than moving into the private market, but who knows. I do hope that whatever happens, there will continue to be jobs for the dedicated staff who currently operate Cover Colorado.
I read other blogs that the $5 billion projected for this interim measure is insufficient to cover its cost. Any comment?
Dr. Retan,
Would you share the links to the other blogs you are speaking about? Seeing the logic/numbers being used by the websites you’re talking about would be helpful. I’ll keep an eye on the spam filter to make sure it doesn’t block your comment because of the links.
I was probably thinking of the Wall Street Journal article, referenced by Suzy Khimm.
http://voices.washingtonpost.com/ezra-klein/2010/04/state_and_the_fate_of_health_r.html
Here’s another blog I’d recalled.
http://wonkroom.thinkprogress.org/2010/04/05/high-risk-pools-implementation/