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PCIP Comes to Life

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The U.S. Department of Health and Human Services has unveiled the new, national temporary health insurance risk pool program, the Pre-existing Condition Insurance Plan.

The federal Affordable Care Act (ACA) – the legislative package that includes the Patient Protection and Affordable Care Act (PPACA) and the Health Care and Education Reconciliation Act – is set to prohibit medical underwriting in the individual market starting with plan years that begin in 2014.

In states that permit individual market medical underwriting, the PCIP program will offer “uninsurable” individuals access to coverage before the national medical underwriting ban kicks in.

Congress included $5 billion in ACA funding to expand risk pool access. In many states that already have risk pools, budget constraints have forced managers to stop enrolling new members. Managers of some existing risk pools have been stretching funding by charging high rates or putting tight limits on benefits.

The District of Columbia and 29 states have decided to run their own risk plans, and 21 states will have the new federal Office of Consumer Information and Insurance Oversight (OCIIO) manage their PCIP coverage.

All states that will run their own risk plans are supposed to start enrolling applicants by the end of the summer, and many are beginning enrollment today, officials say.

In the 21 states where the OCIIO is overseeing the program, applicants can start applying today, officials say.

The PCIP program will be available to people who have a pre-existing medical condition and have been uninsured for 6 months or more. The program covers primary care, specialty care hospital care and prescription drugs.

Rates are not based on income or health status and are supposed to be comparable to rates in a state’s commercial market. Rates for the oldest program members can be up to 4 times higher than rates for the youngest participants.

The director of the OCIIO, Jay Angoff, is a former Missouri insurance director.

“We modeled the program on the highly successful Children’s Health Insurance Program, also known as CHIP, so states would have maximum flexibility to meet the needs of their citizens,” Angoff says in a statement about the program.

The OCIIO director of insurance programs is Richard Popper, a former manager of the Maryland risk pool program.


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