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PCIP: New York, Missouri Pick Risk Pool Managers

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Group Health Inc. will be running the new temporary risk pool in New York state, and a unit of WellPoint Inc. will be running the temporary risk pool in Missouri.

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 – created a $5 billion Pre-existing Condition Insurance Plan (PCIP) program to fill in coverage gaps before a ban on medical underwriting takes effect in 2014.

The PCIP program is supposed to provide “uninsurable” individuals access to coverage at rates comparable to individual rates in the commercial market.

Some states are letting the new federal Office of Consumer Information and Insurance Oversight run their PCIP programs, but 29 states and the District of Columbia want to offer their own risk plans.

New York, which is in the midst of a battle over budget cuts, is expecting to use $297 million in PCIP funding to provide temporary coverage for about 15,000 state residents, officials say.

“The federal government has guaranteed that no financial responsibility for this program will be shifted to the states,” officials say.

New York needs to run its own risk plan, because the state already has laws that require plans to sell coverage on a community-rated, guaranteed-issue basis, officials say.

ACA provisions require a state’s PCIP program manager to be a nonprofit organization, and GHI, a unit of EmblemHealth Inc., is the only nonprofit company authorized to operate statewide in New York state, officials say.

New York is hoping that PCIP program premiums in the state will be less than $600 per month, officials say.

In Missouri, the Missouri Health Insurance Pool, a nonprofit agency that runs an existing Missouri risk pool program, will oversee the PCIP program, according to Missouri Insurance Director John Huff.

MHIP has hired RightChoice, a unit of a subsidiary of WellPoint, Indianapolis (WLP), to administer the risk pool medical benefits, and Catalyst Rx, a unit of Catalyst Health Solutions Inc., Rockville, Md., to administer prescription drug benefits.


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