Tag Archives: high-risk pools

Colorado Health Exchange premiums ~ equal to high-risk pool premiums, and you can’t keep your doctor.

Linda Gorman describes how the so-called Affordable Care Act required one Coloradan to leave Colorado’s high-risk pool for a plan on Colorado’s health insurance exchange, Connect for Health Colorado.  The premiums are similar, but the exchange plan’s a narrow physician network did not include her doctor.  Read more: Colorado Health Exchange Premiums Roughly Equal to Those of High Risk Pool | John Goodman’s Health Policy Blog | NCPA.org.

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Filed under Colorado health care

ObamaCare’s perverse incentives harm those with pre-existing conditions

In the Wall Street Journal, John C. Goodman writes:

But when insurers are forced to charge the same premium to all applicants, regardless of expected health-care costs, prices will be wrong for everyone—and both buyers and sellers of health-care policies will have perverse incentives.

On the buyer’s side, healthy people who are overcharged will underinsure, buying less coverage than they otherwise would. They may even decide to go without insurance, since the ObamaCare penalties for being uninsured are weak and people can always buy a policy after they get sick. People with expensive health problems will overinsure, buying more generous coverage than they otherwise would.

Insurers, on the other hand, will try to sell policies to the healthy, on whom they expect to make a profit, while avoiding the unhealthy, on whom they expect to incur a loss,—and they will change the design of their plans to accomplish this goal.

Preventive care and wellness checkups with no deductible or copayment, for example, will attract and keep the healthy; insurers may even provide memberships in health clubs. But failure to include the best cancer-care center or the top heart clinic in a plan’s network will discourage the sick from enrolling. Insurers may also underprovide for unhealthy people by failing to include the latest cancer drugs in their offerings.

Goodman offers better alternatives than price controls:

  • equalizing the tax treatment of insurance, in the individual and group markets
  • high risk pools
  • health status insurance

Read the whole article for details: The Better Solution for ‘Pre-Existing Conditions’. Or better yet, check out Goodman’s new book.

 

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Filed under insurance, tax code, HSAs

How many are uninsurable because of pre-existing conditions?

Michael Cannon cites two studies that say the pre-existing condition problem is rare. An HHS study says 1% of Americans have been denied coverage because of a pre-existing conditions.  He also sites a study by economists who say the uninsurable is less than 1% of the population.  Cannon then reminds us that the individual market pools risks well, and that allowing insurers to risk-rate premiums would encourage innovative products like health status insurance.

HHS Wildly Overstates the Problem of Pre-Existing Conditions — and Ignores Its Cause | Cato @ Liberty.

Also check out John Goodman’s post:

Although the most important parts of ObamaCare [HR 3590] (the individual mandate, subsidies, employer fines, etc.) do not kick in until 2014, the legislation made interim provision for those with pre-existing conditions problems. A new kind of risk pool is open to anyone who is denied insurance in the private sector and it’s available for the same premiums healthy people pay. Twenty-three states are operating their own risk pools and 27 are relying on a federal plan.

It’s been like giving a party to which no one comes. The Medicare program chief actuary predicted last spring that 375,000 would sign up for the new risk pool insurance in 2010. But by the end of November, only 8,000 had done so.

Whole post here: Health Problem Quantified, and the follow up, How Big is the Pre-existing Condition Problem?

See also this post on guaranteed renewable insurance.

Goodman.

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Filed under myths & fallacies

ObamaCare’s high-risk pools may deny coverage

This week the Denver Business Journal and the Denver Post reported on Colorado’s new federally subsidizes high-risk pools (“GettingUSCovered”). But there’s a good reason to be concerned about quality and access. The Hill reports:

The Obama administration has not ruled out turning sick people away from an insurance program created by the new healthcare law [HR 3590] to provide coverage for the uninsured.

Critics of the $5 billion high-risk pool program insist it will run out of money before Jan. 1, 2014. That’s when the program sunsets and health plans can no longer discriminate against people with pre-existing conditions.

Administration officials insist they can make changes to the program to ensure it lasts until 2014, and that it may not have to turn away sick people. Officials said the administration could also consider reducing benefits under the program, or redistributing funds between state pools. But they acknowledged turning some people away was also a possibility.

Read the whole article: Health law risks turning away sick.

Ed Morrissey at Hot Air comments:

Only one of two things will happen when it’s gone, so it’s hardly “premature” to discuss it.  One option would be to go back to Congress and get more money.  That would mean admitting that Congress had no idea what this program would cost in the first place, and it would also likely push the program even more quickly into deficit spending, so that’s politically unpalatable.  The second would be to stop funding health insurance for those with pre-existing conditions, which means they will be left uninsured until 2014 — and that’s probably even more politically unpalatable.  The only question will be which poison the White House chooses to drink.

If they pick Poison #2, Rob Port from Say Anything has a question for them:

Just so we got this straight, it might be ok for the government to discriminate based on pre-existing conditions, because letting people refrain from getting insurance until they’re sick is a good way to lose a lot of money, but private insurance companies?

Well, it’s evil when they do it.

What turned out to be “premature” was the passage of ObamaCare.  As this demonstrates, Congress had no clear idea of actual costs or complications in the program.  It should never have passed in the first place, but this key issue shows what happens when government attempts to run a business sector without having any expertise in it.

In an article about pre-existing conditions (that for some reason omits health status insurance), James Capretta and Tom Miller note something similar: Continue reading

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Filed under Colorado health care

Post-claims underwriting no justification for government health plan

If you internet service provider violated the contract you made with them by canceled your policy (say you’re hogging bandwidth) is that a reason for government to create a tax-funded “public internet service provider”?  Of course not.  The ISP in this case has violated its contractual agreement to a customer, and the purpose of government is in this case is to enforce the contract and have the ISP compensate you (the victim of the rights violation) for damages.

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Filed under Colorado health care

Insurance industry volunteers to become government contractor

From the Associated Press:

The health insurance industry offered Tuesday for the first time to curb its controversial practice of charging higher premiums to people with a history of medical problems. The offer from America’s Health Insurance Plans and the Blue Cross and Blue Shield Association is a potentially significant shift in the debate over reforming the nation’s health care system …

…the two insurance industry groups said their members are willing to “phase out the practice of varying premiums based on health status in the individual market” if all Americans are required to get coverage.

Insurers are trying to head off the creation of a government insurance plan that would compete with them, something that liberals and many Democrats are pressing for.

So instead of a government insurance plan competing with insurance companies, insurance companies will simply offer government-approved insurance.   This happens now to some extent.  But when government requires you to buy insurance, politicians get even more power to define what legal insurance is.

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Filed under mandatory insurance, Policy - National