New insurance plans created under the Affordable Care Act for those already sick and other “high risk” individuals are coming with insurance premiums too high to be affordable to those who need coverage, and are failing to draw as many members as expected, raising questions over whether the $5 billion allotted to the program will be enough.
The “Pre-Existing Condition Insurance Plan” was designed as a stopgap until Obamacare’s powerful inducements come online, allowing states to either create their own “high-risk pools” or let their residents buy coverage under a new federal plan. WaPo reports what’s happened s far:
In the spring, the Medicare program’s chief actuary predicted that 375,000 people would sign up for the pool plans by the end of the year. Early last month, the Health and Human Services Department reported that just 8,000 people had enrolled. HHS officials declined to provide an update, although they collect such figures monthly, because they have decided to report them on a quarterly basis.
“Like the rest of the country, we thought we’d have pretty much a stampede. That obviously hasn’t materialized,” said Michael Keough, executive director of North Carolina’s plan. With nearly 700 participants, it is among the nation’s largest so far, but it has one-third of the people expected by now.
According to interviews with administrators of nine of the state-run plans, only one – Colorado’s – is close to its forecast enrollment. Maryland, the only jurisdiction in the Washington area that has created a plan, has 97 participants, compared with 19,000 in an older state high-risk pool, according to Kent McKinney, who directs both. HHS’s November report said that Virginia had 75 participants in the federal plan. The District had none.
And in some states where the plans have been adopted, they have proven far more costly than anticipated:
Montana is one of a few states in which the medical bills from those who have joined are huge. New Hampshire’s plan has only about 80 members, but they already have spent nearly double the $650,000 the state was allotted in federal money to help run the program, said J. Michael Degnan, its director.
The spending, Degnan speculated, might slow down if it turns out that the early bills reflected a burst of pent-up need for care. HHS agreed to give New Hampshire more money, he added.
HHS is responding to the slow pickup by lowering some premiums and expanding eligibility (i.e. making the plans more expensive for taxpayers) and by spending more money marketing them.