New Fund Publication Examines Pre-Existing Condition Insurance Plans

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<p>One of the first provisions of the Affordable Care Act to go into effect this year is the establishment of a temporary national high-risk insurance pool program—the Pre-Existing Condition Insurance Plan (PCIP). The PCIPs, now available in all 50 states and the District of Columbia, are aimed at helping uninsured people with health conditions gain access to health coverage. The program will provide important transitional relief to people with chronic health problems before the major provisions of the new law go into effect in 2014.</p>
<p>In the <a href="/publications/issue-briefs/2010/oct/realizing-health-reforms-potential-pre-existing-condition">latest issue brief</a> from The Commonwealth Fund’s <a href="~/link.aspx?_id=F4EDA1AE78A944BEA80198B614439375&_z=z">Realizing Health Reform’s Potential series</a>, Jean Hall and Janice Moore of the University of Kansas examine eligibility, benefits, premiums, cost-sharing, and oversight of the state PCIP programs, as well as variation in the plans from state to state. According to the authors, the PCIPs provide an early opportunity for as many as 6 million uninsured Americans who previously had been excluded from the individual market to acquire coverage. Although similar to existing state high-risk pools, PCIPs have a number of important differences that should make them more accessible and affordable, including: </p>
<li>No waiting periods. Most existing state pools impose a three- to 12-month waiting period for coverage of preexisting conditions. </li>
<li>Premiums capped for a standard population in the individual insurance market—and they can be lower.  </li>
<li>Out-of-pocket costs capped at $5,950 for an individual.  </li>
<li>Limits on how much premiums can vary by age.  </li>
<li>Transferability of PCIP coverage eligibility from state to state. <br /></li>
<p>Twenty-seven states are now running their own PCIPs, and 23 states and the District of Columbia have federally administered plans. There is a great deal of variation across the states: for example, most plans have a deductible of $2,500, but 15 states offer plans with deductibles at or below $1,000, and Washington and Maryland set their out-of-pocket limits well below the federal standard at $1,500. </p>
<p>While PCIPs should help many Americans denied coverage in the individual market, people with low incomes may still find it challenging to afford coverage, which may limit enrollment in this transitional program. However, starting in 2014, individuals with incomes below 133 percent of the federal poverty level will be eligible for Medicaid, and those with incomes up to 400 percent of the poverty level will be eligible for comprehensive subsidized private coverage through the new health insurance exchanges. </p>
<p>Learn more about PCIPs by participating in the upcoming Fund webinar <a href="; target="_blank">Preexisting Condition Insurance Plans Created by the Affordable Care Act</a>:<br /><br /><strong>When: </strong>Thursday, Oct. 7, at 2 p.m., E.T. <br /><br /><strong>Speakers: Jean P. Hall, Ph.D., </strong>associate research professor at the University of Kansas, and <strong>Amie Goldman</strong>, CEO of the Health Insurance Risk-Sharing Plan Authority in Wisconsin and chair of the National Association of State Comprehensive Health Insurance Plans; and <strong>Deborah Armstrong</strong>, executive director of the New Mexico Medical Insurance Pool. <br /><br /><strong>Moderator: Sara R. Collins. Ph.D</strong>., vice president and director of The Commonwealth Fund’s Affordable Health Insurance program. <br /><br />To register, go to <a href="">…;  <br /></p>