High-Risk Insurance Pools Might Make a Comeback

The ACA requires that insurers cover people with pre-existing conditions. It looks increasingly clear, however, that the Trump administration will dismantle the ACA. Which sets up a back-to-the-future scenario in which high-risk programs could very likely make a comeback, reports the New York Times.

High-risk programs separate people with pre-existing conditions or who are very ill—whose medical costs are likely to be off-the-charts, in other words—from those who are relatively healthy. “Insurers could charge higher prices to those with existing medical conditions, but they would also rely on other sources of funding, including from the government, to cover their costs,” the Times reports. Before the ACA, 35 states had such programs in place.

The ACA includes the individual mandate (also, apparently, on the chopping block) which, in theory, spreads the risk pool so that there are enough healthy enrollees who could counter the costs of those whose care is more expensive. But, as evidence by the soaring premium increases in some of the ACA exchanges, a lot of the younger, healthier people would rather take the fine than sign up for coverage. 

For some people, the high-risk programs worked—at least for a while. The Times relates a story about a couple where the wife fought breast cancer. They had to pay $375 a month for a plan that covered her treatments. That high-risk program closed and the couple had to search for a plan that met the requirements of the ACA.

The couple in the Times story had to settle for a plan that charged a premium of $900 a month with a $12,000 deductible. Because the couple earned too much, they were not eligible for government subsidies that would help 80% of the people in such a situation.

Source: New York Times