States Indicate Interest in Administering High-Risk Pools
By the end of Friday, officials from 28 states and the District of Columbia had informed HHS that they will administer their own high-risk pools to comply with a provision in the new health reform law, instead of allowing the federal government to implement the program for them, Politico reports.
Meanwhile, 15 states indicated that they will transfer the responsibility of administering the pools to the federal government (Haberkorn, Politico, 5/3).
Under the program outlined in the new health reform law, states are permitted to create their own pools or expand existing ones, or they could allow the federal government to implement such a pool for them. The law allocates $5 billion for the program (California Healthline, 4/27).
U.S. residents will be eligible for coverage under the pools if they have a pre-existing condition and have been without health insurance for at least six months (Levey, Los Angeles Times, 5/1).
Many of the states that opted out of the program already have pools that only need to be expanded or modified to meet the new federal requirements, Politico reports. According to Politico, most of the states that decided to use their own high-risk pools have Democratic governors, while most of the states that are defaulting to the federal government's programs have Republican governors (Politico, 5/3).
Among the states that have opted to operate their own high-risk pools are:
- New Jersey;
- Ohio; and
States that have chosen to let HHS run their programs include:
- Nevada; and
On Friday, HHS announced the allocation of the $5 billion for the pools, according to The Hill. California will get the largest share of $761 million, while three states -- North Dakota, Vermont and Wyoming -- each will receive $8 million.
States Concerned With Potential Costs
The high-risk pools are scheduled to begin operating on July 1 and expire in 2014, when the overhaul requires private insurers to accept all applicants regardless of pre-existing conditions (Pecquet, The Hill, 5/1).
Although the deadline for states to declare their positions to HHS was Friday, several states still have not responded.
However, HHS spokesperson Jenny Backus said the agency is happy with the response. Backus added, "Whether states create these pools or the federal government creates them for states, the pools will be paid for by 100% federal dollars" (Politico, 5/3).
Concerns over the program's cost and fears that states would be responsible for some portions of it until 2014 played a key role in several states' decisions to reject the government plan, the Los Angeles Times reports.
Last month, officials from Georgia and Nebraska wrote to HHS Secretary Kathleen Sebelius expressing their concerns (Los Angeles Times, 5/1).
According to The Hill, CMS Chief Actuary Rick Foster noted in an analysis of the new reform law released last month that "by 2011 and 2012 the initial $5 billion in federal funding for this program would be exhausted, resulting in substantial premium increases to sustain the program; we anticipate that such increases would limit further participation" (The Hill, 5/1).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.