Individuals applying for coverage under the high risk pools run by the federal government in 23 states and the District of Columbia will just have to show a doctor’s note that says they have a pre-existing medical condition. Is there any question about the abuse this leads to from individuals that do not want to pay for coverage until they become ill?
Premiums will drop as much as 40 percent in 17 of the states plus the District where the federally run plans operate, bringing high-risk premiums in those states closer to the rates that can be found in the individual market. The premium costs and the requirement to prove an inability to find insurance were two obstacles that have kept the high-risk pool enrollment to below 20,000 people when the promise was that 500,000 would enroll.
There was a time when many experts believed the $5 billion set aside for high-risk pools by the health reform law wouldn’t be enough to meet demand. The pools were designed to be an early carrot in the health law that would give people coverage options until 2014, when insurance carriers will no longer be able to discriminate based on pre-existing conditions.
TransparentRx, LLC has over ten years experience in the health insurance industry. We have observed many carriers try to gain market share. Experience demonstrates that the quickest way to failure for an insurer is to eliminate all barriers to entry and lower prices. If HHS were faced with the same scrutiny by state insurance departments as insurance companies, they would be served with Cease and Desist Orders for the way the risk pools are being managed.
On the other hand, insurance companies do not have the deep pockets of the American Taxpayer to fall back on. This, in turn, leads to higher costs for plan sponsors.