Life Health Pro, By Elizabeth Festa
February 23, 2012
The Pre-existing Condition Insurance Plan (PCIP) — a new health insurance program for people with health problems — ended 2011 with 48,879 enrollees.
That’s up from none in the summer of 2010, when the program started, officials at the Center for Consumer Information and Insurance Oversight (CCIIO) say in a new PCIP report.
But enrollment is running far below expectations. PCIP designers, and critics, originally were predicting that millions of Americans would rush to sign up for coverage.
The consumers who have enrolled have turned out to be far sicker than officials had anticipated: Enrollees are averaging about $29,000 in claims per year. That’s twice the average traditional state high risk pools have experienced in recent years, CCIIO officials say.
In Colorado, for example, officials have found that enrollees in a state health insurance risk pool program have 137 hospital admissions per 1,000 enrollees per year. The hospital admission rate for PCIP enrollees in Colorado is 562 admissions per 1,000 enrollees per year.
In another state, Kansas, claims expenditures have averaged $1,376 per member per month for state risk pool enrollees and $3,449 per member per month for PCIP enrollees, officials say.
The Patient Protection and Affordable Care Act of 2010 (PPACA) requires health insurers to sell subsidized coverage on a guaranteed issue, mostly community-rated basis starting in 2014.
PPACA drafters included the PCIP program in PPACA in an effort to provide temporary relief for consumers with pre-existing conditions who cannot qualify for commercial health insurance, Medicare or Medicaid.
Many PCIP participants need treatment for conditions such as cancer, ischemic heart disease, degenerative bone diseases or hemophilia, officials say.
People who enroll in the PCIP program are not charged a higher premium because of their medical condition. Premiums may vary only on the basis of age, geographic area and tobacco use.
About half the states are administering their own PCIP programs. The federal government is administering PCIP coverage for residents of the other states.
The states with the highest PCIP enrollment are California, Pennsylvania and Texas.
To keep PCIP from crowding out existing types of private and public health coverage, Congress required that PCIP enrollees be individuals who have gone without health insurance, including state risk pool coverage, for at least 6 months.
Jean P. Hall and Janice Moore have suggested in a PCIP program review released by the Commonwealth Fund in June 2011 that the 6-month waiting period rule may be one program feature that has held down enrollment growth. “Individuals with preexisting conditions not meeting this requirement may choose to enroll in state-based, high-risk pools that do not have this requirement, or they may find other coverage that excludes treatment of their preexisting conditions (i.e., a policy with a rider),” the researchers say.
CCIIO officials say in their report that other program features may contribute to high per-member medical costs. “Coverage related to the care or treatment of an enrollee’s pre-existing condition begins immediately upon the plan’s effective date, unlike other types of insurance coverage currently available in the individual market, which may impose pre-existing condition limits or exclusion periods,” officials say.
In addition, because many people with health problems who have a choice enroll in state health insurance risk pools, which do not require individuals to go without health insurance for 6 months, “PCIP may attract individuals who have been recently diagnosed with a severe illness or condition that requires immediate care or treatment,” CCIIO officials say. “Additionally, people who may otherwise qualify for PCIP may postpone enrolling until they have an immediate need for coverage.”
Allison Bell contributed additional information to this article.