High Risk Pool

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High-Risk Health Insurance Pools

August 9, 2011 in Health Insurance | 5 comments

Many individuals are uninsureable. Their pre-existing conditions indicate that they are so risky either: i) no insurance company would cover them or ii) the premiums would be so high that the individual could not afford them. To insure some of these people, many states have set up high-risk health insurance pools (HRP). Currently, all these pools operate at a loss. This is not surprising; if states could profit from insuring high-risk individuals, than the private market could certainly as well and thus there would be no need for HRPs.

Today I will review some HRP statistics from a 2009 GAO report.

Spending

  • Total claims paid by HRPs in 2008 were about $1.9 billion, accounting for almost 95 percent of total HRP expenditures. The average claims per enrolled individual totaled $9,437 in 2008, an increase of about 39 percent since 2003.

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Health Reform’s Creation of a High Risk Insurance Pool

April 8, 2010 in Health Insurance | No comments

One of the first steps after the passage of health reform is the creation of a high risk pool for uninsured individuals.  This is help individuals such as 56 year old Laura Carpenter of Tuolumne, CA.  Individuals such as With the $5 billion allocated for this task, Health and Human Services (HHS) Secretary Kathleen Sebelius sent the following letter to U.S. governors:

“The establishment of a temporary new high risk pool program is one of our first tasks in implementing the new health reform law and will help provide affordable insurance for Americans who have been locked out of the insurance market for too long,” said Sebelius. “This letter marks the first step in that process and demonstrates one of our core principles of implementation — building on effective programs that already exist. In the coming days, we will work closely with states to answer their questions.”

States have 5 options of how they could participate:

  • Operate a new high risk pool alongside a current state high risk pool;
  • Establish a new high risk pool ;
  • Build upon other existing coverage programs designed to cover high risk individuals;
  • Contract with a current HIPAA carrier of last resort; or
  • Do nothing, in which case the federal government through HHS would carry out a coverage program in the state.

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