Mary Taylor, the Ohio lieutenant governor and insurance commissioner, accused the U.S. Department of Health and Human Services (HHS) of meddling in destructive ways with the operations of Ohio’s Pre-existing Condition Insurance Plan (PCIP).
Taylor, a Republican who has strongly opposed the Patient Protection and Affordable Care Act (PPACA), said her experiences with HHS PCIP managers were “less than rewarding.”
“Based on the experiences that we had with the federal government overseeing the high-risk pool, we fear that similar problems will arise as PPACA is fully implemented,” Taylor said.
Taylor appeared Wednesday at a hearing, on “Protecting America’s Sick and Chronically Ill,” that was organized by the House Energy & Commerce health subcommittee.
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The subcommittee organized the to examine PCIP’s problems and talk about ways to help Americans with health problems get affordable health coverage.
Except for Susan Zurface, a single lawyer with blood cancer who expects to have trouble getting health coverage to replace needs-based coverage that’s about to expire, all of the witnesses were strongly partisan. No officials from HHS testified. Other than Taylor, no witnesses or lawmakers gave any details about how PCIP (pronounced “P-sip”) really worked and why it failed.
Republicans concluded from the PCIP failure that the country needs to provide health coverage for sick people with bigger, better-funded, state-run high-risk pools free from the clutches of HHS. Democratic witnesses said the country needs to do a good job of getting, and keeping, sick people into general plans that are as big, diverse and efficient as possible.
PPACA and PCIP
The drafters of the Patient Protection and Affordable Care Act of 2010 (PPACA) created PCIP (pronounced “P-sip”) in an effort to provide temporary relief for people who were not healthy enough to qualify for affordable commercial health coverage in states that allow health insurers to consider personal health information when issuing and pricing coverage.
PPACA is supposed to ban use of personal health information in decisions to issue individual coverage in 2014 and restrict use of personal health information other than age in decisions about coverage prices.
Congress provided $5 billion for PCIP and let states choose between running their own PCIP programs or having HHS run the PCIP programs for their residents. The rates for coverage are supposed to be comparable to rates for ordinary commercial coverage. The program is open only to people with health problems who have been uninsured for at least six months.
Enrollment in the program has been much lower than expected, but the average level of medical claims per enrollee has been much lower than expected.
HHS officials announced Feb. 15, during a little-publicized conference call with state officials that they were ending the PCIP application review program immediately and wanted states to stop processing state PCIP applications. HHS also increase enrollees’ cost-sharing limits and asked the state PCIP plans to look into doing the same.
Ohio ran its own PCIP risk pool program, using a private health insurer as the administrator.
HHS gave the Ohio PCIP program high marks for administrative efficiency and enrollment growth, but HHS officials ended up meddling with the administrator’s efforts to set rates for the 2011-2012 plan year, Taylor said.
The Ohio Department of Insurance originally agreed to let the administrator increase the premiums for a plan with a $2,500 deductible by 3 percent and the premiums for a plan with a $1,500 deductible by 17 percent.