KHN Morning Briefing

Summaries of health policy coverage from major news organizations

Sebelius: High Risk Health Insurance Pools To Begin Soon

News outlets covered the next step in covering hard-to-insure Americans.

PBS Newshour: "In one of the first moves the Obama administration has taken under the new health care reform law, Health and Human Services Secretary Kathleen Sebelius on Friday sent a letter to state governors and insurance commissioners intended to gauge interest in a new insurance high-risk pool program. The health care reform bill provides $5 billion in funding to create a network of insurance pools for people with pre-existing medical conditions who do not have insurance. The pools are intended to open within 90 days, and are a stopgap measure that will last until 2014, when insurance companies will no longer be able to deny coverage to anyone based on pre-existing conditions" (Winerman, 4/2).

The Wall Street Journal: "Beginning July 1, the pools will provide insurance for adults with pre-existing health conditions who lack insurance through an employer and can't get affordable coverage on their own. By 2014, the health law will replace them with new state-run insurance exchanges. ... About 35 states currently operate their own high-risk pools. In her letter to states, Ms. Sebelius gave five options for participating in the new program. States that already have such pools can add a new pool; those that don't can start a risk-pool. States also can build on other existing programs to cover high-risk adults or contract with a so-called carrier of last resort to provide subsidized coverage. If a state chose to do nothing, HHS would carry out its own coverage program in the state" (Adamy, 4/2).

Related, earlier KHN story: The First Test Of New Health Law: Covering Hard-To-Insure People (Carey, 3/26)

The Associated Press: The administration is under pressure to turn the health care bill from a political negative into a positive ahead of the fall elections and to undercut Republican calls to repeal the law. ... Some details about the new buying pools remain fuzzy, including how many people might qualify, how much they will have to pay in premiums, how existing state programs would be affected and whether $5 billion will be enough. Some experts have said the money will fall far short and will likely run out in the next couple years. The program is available to people with pre-existing conditions who have been uninsured for at least six months" (Werner, 4/2).

The New York Times: "Premiums in the new program will be set at 'standard rates,' based on the average premiums charged by private insurers for similar coverage in the individual market. ... Ms. Sebelius may establish a minimum set of benefits. The law specifies a limit on out-of-pocket medical costs, which cannot exceed $5,950 a year for an individual in the pool. ... State high-risk pools, all of which operate at a loss, paid a total of $1.9 billion in claims in 2008, according to a recent report by the Government Accountability Office, an investigative arm of Congress. " (Pear, 4/2).

Bloomberg: "The high-risk pool expansion is a federal program, though much of the implementation is being left up to state governments that are on the front line of regulating insurance companies and providing health care services like Medicaid. While many of the benefits in the federal law have been billed as immediate, it may take months for states that lack a high-risk pool to figure out how to get them up and running, federal officials have said."

"'Our health-care system wasn't broken in a day, and it won't be fixed in a day either,'" Jenny Backus, a spokeswoman for Sebelius, said earlier this week" (Armstrong, 4/2).

Omaha World-Herald: "Nebraska and Iowa may end up with two separate high-risk health insurance pools in each state for people with pre-existing medical conditions. One would be the pools already operated by the state governments, which provide health insurance to about 5,000 people in Nebraska and 3,000 in Iowa. ... The two states are among 34 that already operate high-risk insurance pools, which provide high-cost coverage for people turned down by private insurers" (Jordan, 4/3).

Chicago Sun-Times: Michael McRaith, director of the Illinois Department of Insurance, said Friday that the state is well-positioned to meet the federal requirements. ... Enrollees in the state's two existing high-risk pools, both offered under the Illinois Comprehensive Health Insurance Plan (ICHIP), shoulder two-thirds of the cost, which translates to "cost-prohibitive" annual premiums of $12,000 to $16,000, McRaith said. 'National reform will reverse that equation so premiums constitute no more than 35 percent of the cost of the program,' he said" (Thomas, 4/3).

Modern Healthcare: "Governors and independent state insurance commissioners have until April 30 to respond to the letter. ... Members must be U.S. citizens who have been uninsured for at least six months. Some Republican governors have said they plan to sue the federal government to block the health reform law's implementation. But officials at the HHS said they hope the governors will cooperate with this new program" (Vesely, 4/2).

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