One of the most popular components of the Patient Protection and Affordable Care Act — a special health insurance program for people with health problems — has had trouble providing coverage that sick people can afford in a sustainable way.
Jean Hall, a Medicaid researcher at the University of Kansas, and Janice Moore, a data manager at the university, have discussed the problems at the Pre-Existing Condition Insurance Plan (PCIP) program in a new report released by the Commonwealth Fund.
The PCIP program has helped some people with health problems, but it is too expensive for most of the people who need it, the researchers said in the report.
Monthly premiums for a 50-year-old range are less than $300 in some states, such as Michigan and Virginia, but they are over $1,000 in Alaska and Washington state, and they can be over $500 in 11 other states, the researchers said.
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Even though the premiums are high, the PCIP enrollees are so sick that the ratio of claims costs to revenue is very high, the researchers said.
The researchers have included state-by-state data showing that the ratio of medical losses to revenue at the PCIP plans is at least twice as high and, in some cases, 8 times as high, as the medical loss ratios at the comparable state “risk pool” plans.
In New Hampshire, the medical loss ratio for the state risk pool is 140% of the standard-plan loss ratio. The PCIP plan has a medical loss ratio equal to 1,230% of the standard-plan loss ratio.
In New Mexico, the state risk pool has a loss ratio equal to 442% of the standard-plan loss ratio. The PCIP plan has a loss ratio equal to 1,151% of the standard-plan loss ratio.
“Given the general lack of affordability of high-risk pool coverage at the individual level and the high costs of plan operation, the potential of high-risk pools as a vehicle for coverage expansion remains quite limited,” the researchers said.
Congress put the PCIP program in PPACA in an effort to provide immediate relief for uninsured people with health problems. PCIP is meant to help fill the gap between the date PPACA was signed in March 2010 and the day when insurers are supposed to start selling subsidized coverage on a guaranteed issue, mostly community-rated basis in 2014.