Why a National High-Risk Pool Doesn’t Work

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If there is one key lesson to be learned from the Pre-Existing Condition Insurance Plan (PCIP), the temporary national high-risk pool established under the Affordable Care Act, it is this: insurance works best when risk is spread evenly across a broad population. <br /><br />
In a new Commonwealth Fund issue brief, Jean P. Hall of the University of Kansas shows why high-risk pools like the PCIPs are expensive for enrollees, expensive to run, and, over time, financially unsustainable. The PCIP program, which ended in April, fulfilled its intended purpose of providing critically needed short-term health insurance coverage to people with serious and often life-threatening conditions. But because so many of its enrollees were high users of health services, its costs were greater than anticipated. <br />
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Creating a national high-risk pool as a permanent alternative to the marketplaces—as some policymakers have suggested—would result in many of the same cost and coverage challenges seen in PCIP, Hall concludes.

http://www.commonwealthfund.org/publications/newsletters/ealerts/2014/dec/why-a-national-highrisk-pool-doesnt-work Read the brief