Realizing Health Reform’s Potential: Why a National High-Risk Insurance Pool Is Not a Workable Alternative to the Marketplace

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    The key lesson of PCIP: Insurance works best when risk is spread evenly across a broad population
    National high-risk pools are expensive for enrollees & administrators, and are ultimately unsustainable

Overview

The Pre-Existing Condition Insurance Plan (PCIP) was a national high-risk pool established under the Affordable Care Act (ACA) to provide coverage for individuals with preexisting conditions who had been uninsured for at least six months. It was intended to be a temporary program: PCIPs opened in 2010 and closed in April 2014. At that point, those with preexisting conditions could shop for health insurance in the marketplaces, where plans are prevented from using applicants’ health status to deny coverage or charge more. This issue brief draws on the PCIP experience to outline why national high-risk pools, which continue to be proposed as policy alternatives to ACA coverage expansions, are expensive to enrollees as well as their administrators and ultimately unsustainable. The key lesson—and the principle on which the ACA is built—is that insurance works best when risk is evenly spread across a broad population.

Read the brief.

Hall Exhibit 1

Downloads

Publication Details

Publication Date:
December 11, 2014
Authors:
Jean P. Hall
Contact:
Jean P. Hall, Professor, University of Kansas Medical Center
E-mail: jhall@ku.edu
Citation:
J. Hall, Realizing Health Reform’s Potential: Why a National High-Risk Insurance Pool Is Not a Workable Alternative to the Marketplace, The Commonwealth Fund, December 2014.

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