It’s (very) easy to make fun of the Affordable Care Act public health insurance exchange system.
The system was supposed to be a subsidized, government-run Web-based supermarket for health insurance. The board members of some of the state-based exchanges seemed to spend more time obsessing about their TV commercials than about whether their enrollment systems or back-office administration systems would work.
Today, however, some opponents of ACA rules and programs are proposing a partial alternative that could be much worse: a return to putting people with serious health problems, such as diabetes, HIV or hemophilia, into special high-risk pool programs.
A high-risk pool is a program that helps people who do not qualify for Medicare or Medicaid, and are unable to qualify for major medical coverage, pay their medical bills.
Many states set up high-risk pools for their residents in the 1990s and early 2000s, before the ACA banned the use of personal information other than age and location in decisions about whether to offer health coverage.
Some opponents of the current ACA system want to replace ACA exchange programs, exchange plan subsidies and health insurance medical underwriting rules with high-risk pools. Those ACA opponents say that covering people with HIV, diabetes or heart disease through an ordinary health plan, for an ordinary price, without special benefits limits, is too expensive. Keeping people with obvious, catastrophic health problems out of a health plan is important to keeping the cost of a plan down, and keeping the cost of a plan down is critical to getting healthy people to pay for coverage, those ACA critics say.
From my perspective, a bigger problem is that poorly designed, poorly administered high-risk pool coverage can be a nightmare.
Back in the heyday of high-risk pools, some states obtained solid insurance for risk pool enrollees. Other states self-funded the pool coverage. The self-funded high-risk pool coverage did not always count, legally speaking, as major medical insurance.
In some cases, the benefits the high-risk pools offered were weak. Before the ACA came along, a typical major medical plan might have set a $1 million cap on annual benefits payments. The ACA has outlawed use of annual or lifetime benefits limits on essential health benefits at plans issued after March 23, 2010.
In California, in contrast, pre-ACA high-risk pool enrollees faced a $75,000 annual cap on benefits payments. In other words, one round of brain surgery for treating an aneurysm could have eaten up all of a patient’s risk pool benefits for a year, according to care cost data from Campbell, Calif.-based CostHelper.
Other states kept the quality of high-risk pool coverage high by strictly rationing access to the coverage. High-risk pool waiting lists were common.
In 2004, for example, Louisiana magnanimously added enough high-risk pool capacity to its 500-person high-risk pool program to serve 225 extra people. In 2007, it added 1,800 slots.
Illinois is another example of a state that often had high-risk pool wait lists.
When a high-risk pool offers weak benefits, or it uses tight enrollment limits to restrict claim costs, then it’s effectively rationing the enrollees’ access to care, through mechanisms that ordinary consumers might not notice or understand.
I think it’s reasonable to fear that any government involvement in civilian health care finance may ultimately lead to bureaucracy that will increase costs even for the poorest patients. But, if we as a society are going to still try to do something for people with health problems, even if we replace the ACA commercial health insurance provisions, then I think should be honest about how any shift might affect poor people. We shouldn’t use euphemisms to hide the reality that, at least in the short run, we might be reducing sick people’s access to care.
The burden is on the designers of any new high-risk pool programs to show why they think their programs would have enough capacity to meet sick people’s health needs better than the pre-ACA risk pools did.
Have you followed us on Facebook?