More about those high risk pools

As a follow-up to an earlier post, my Kaiser Health News high-risk pools piece is now up. Yeah the pre-existing condition insurance plans are problematic, embarrassingly under-funded stop-gap measures. Their inherent complexities create many administrative challenges and glitches. Yet this effort is taking more than its share of cheap shots, too.

I think a key passage is here:

Conservative health policy expert John Goodman presents one of the toughest critiques. Noting the high-risk pools’ low initial enrollment, he concludes:

“We now know how many people have the problem most often cited as the reason for last year’s health overhaul legislation. Answer: 8,000.
No, that’s not a misprint. Out of 310 million Americans, only 8,000 people have the problem given as the principal reason for spending almost $1 trillion, creating more than 150 regulatory agencies and causing perhaps 150 million or more people to change the coverage they now have.”

Leaving aside that “150 million or more” number, I’m puzzled that Goodman would take low initial enrollment as a sign that problems of the medically uninsured were “hyped and exaggerated from the get go.”

My own work and the work of others documents that a significant number of Americans face the dual challenge of uninsurance and serious illness. For example, data from the 2005-2006 National Health and Nutrition Examination Survey (the most recent complete data available when this research was done) indicate that 440,000 uninsured Americans have been diagnosed with strokes. Almost 1.3 million have a history of cancer. More than 500,000 were diagnosed with congestive heart failure. In many cases, such conditions pose obvious obstacles to obtaining affordable health insurance coverage.

Several million other Americans who successfully obtain health coverage through the individual and small-group markets report they experience higher premiums, coverage denials and personal economic hardship related to their own or a loved-one’s pre-existing condition. Then there are the hundreds of thousands of Americans deemed sufficiently ill or injured to qualify for federal disability benefits, yet who are currently uninsured during the two-year waiting period for Medicare coverage.

This program’s trials and tribulations do not provide good arguments for cutting its funding or for lowering our sights in health reform. Quite the opposite, in fact.

Author: Harold Pollack

Harold Pollack is Helen Ross Professor of Social Service Administration at the University of Chicago. He has served on three expert committees of the National Academies of Science. His recent research appears in such journals as Addiction, Journal of the American Medical Association, and American Journal of Public Health. He writes regularly on HIV prevention, crime and drug policy, health reform, and disability policy for American Prospect,, and other news outlets. His essay, "Lessons from an Emergency Room Nightmare" was selected for the collection The Best American Medical Writing, 2009. He recently participated, with zero critical acclaim, in the University of Chicago's annual Latke-Hamentaschen debate.

14 thoughts on “More about those high risk pools”

  1. It is beyond absurd to suggest that only 8,000 Americans are affected by the pre-existing condition problem. You cite many reasons for that, but do not mention the vast number pinned in jobs from which they would otherwise move on, to the detriment of a vital labor market, by the actual or feared inability to change insurance plans effectively. It must also be remembered that the 2010 reforms, although a great improvement in many areas, was partially crippled in numerous aspects by those would prefer to do nothing.

  2. I turn 62 tomorrow, am unemployed and uninsured. I HAD HepC, but it has been cured by a clinical trial I found and enrolled in. I have been diagnosed with Barret's Syndrome, a known precursor to esophagus cancer. I need scope jobs periodically for monitoring.

    But I can't buy any reasonable insurance because of pre-existing conditions. The law that they must sell me insurance goes into effect 1JAN14. 18 days later, I turn 65.

    These people surely haven't counted me. I feel invisible and very vulnerable.

  3. Bruce Wilder: ditto!!!

    Mr. Crews: don't give up hope!!! Things can change during that time. Maybe, by some miracle, people will realize how much better we could still make that plan. (A long shot though.) And I am visualizing a nice fat job with perks for you! And me.

    Why is this Goodman person called an "expert?" Just wondering. Besides, doesn't he sound like an advocate of Medicare for all? That *would* be much more simple than what we're getting.

  4. Richard best of luck to you. Check out to see if you have available choices you have not considered.

  5. Mr. Pollock,

    I share your evaluation of the weaknesses of the high risk pools. My biggest disappointment with the health care act is so little happens between now and 2014. However the stopgap, expensive care available through the Oregon Federal high risk pool program has taken a load off of my mind. My first wife died after a long illness were the insurance paid about $800,000 in medical bills. I've been worried for a few years what we'd do is my current wife took ill. She enrolled in early November. We heard nothing until we called at the end of November and were told she'd been covered all month. No card or plan numbers so a bit awkward to use. Supposed to get a bill for the first month then automatic payments thereafter. We received our first bill the last week of December with an ominous note that the grace period was nearly expired and if they didn't receive payment we'd be out of the the program and unable to reapply. No idea how long the grace period is and a couple hours on the phone provided no answers. The phone person suggested we look in the pamphlet we hadn't been sent or get the info off their website. We'd been to the website and had it up during the phone call. Didn't seem that the phone person could find the website. Trust me the website said something like there would be info as soon as it was available. We've now paid twice for December, one check and one auto draft, but I believe she's really covered. The $611 a month stings but we won't miss any meals. It's been a long strange trip but I'd rather have this than nothing.

  6. Pardon my language, but John Goodman can fuck off. I am not one of those 8,000. The only reason I am not is because the state of Minnesota has fully funded its high risk pool insurance program for years. There are 30,000 people in it. They do not meet Goodman's definition of needing the federal program, because the state has already done it. His methodology for determining how many people needed tax funded high risk insurance involves excluding everyone who already has tax funded high risk insurance.

    At a minimum, that's 30,000 people who will eventually be covered by the federal government's guarantee for such insurance that do not represent any new net tax expenditures. The amount it costs the federal government will be almost exactly equal to what it no longer costs the state.

    Note also that the 30,000 covered Minnesota is about one-sixth of all of the people enrolled in the entire country. Given that the overall economy in Minnesota is better than the national average, I feel pretty secure in saying that the percentage of Americans that need such coverage is higher than the percentage of Minnesotans that need it. MCHA covers 0.56% of the population here. At the same percentage, that's about 1.75 million Americans that need high risk coverage. Less the 150,000 covered by other state plans, that leaves what I consider to be a very conservative estimate of 1.6 million that still need coverage.

    The problem John Goodman should be addressing is why it is why 99.5% of the Americans who need high risk insurance have not signed up for the program. Instead, he is producing a lowball estimate of those who need it that is so ridiculous that he either spent no more than a minute thinking about the problem before answering, or he is providing an answer that he knows is false. Either way, he should have just destroyed his credibility on the entire subject.

  7. Many states have had their own high risk pools, such as MN and CT. Other states, like NY, have community rating so it has already been the case there for years that no one could be refused coverage. So I agree Goodman's conclusion, drawn from limited enrollment in the new high risk pool plans, is nonsense.

    However, there is still a failure on all sides to face into the real problem, which is that comprehensive insurance plans, whether private or socialized, are doomed to fail since providing coverage for every small bill is not in accord with any insuring principle. The point of insurance is to assemble a pool of covered lives to share the burden of the infrequent catastrophic cost. In the 1960's and 1970's, this is what was known as major medical insurance. When employers took over covering most lives (before that, most people didn't have health insurance at all, except for those who bought privately underwritten major medical), they adopted a comprehensive approach. This killed individual major medical and set the stage for where we are now.

    If anyone believes either single payor or socialized medicine (as in Europe) can be provided on an efficient or economic basis, I have a bridge I would like to sell you. Health insurance should be relegated to a major medical type role, be privately underwritten on a guaranteed renewable basis, and people should pay their own routine bills (for checkups, blood tests, etc.). I know this means that everyone (of those who choose not to buy major medical until too late) won't be able to afford transplants and other heroic procedures, and that's how it was until somehow those became "entitlements." Unfortunately, they are entitlements that no society can really afford.

    Ironically, we were working our way back to this major medical type approach as high deductible plans were becoming more popular. Than PPACA was imposed.

    Doctors love that everyone is a candidate for bypass and other surgery, paid for by an insurer or the government, and this is a big part of the inflation of medical services. Maybe in a world where there is often no one to pay, prices would come down. As it is, people who can't afford such procedures have them anyway, and medical providors simply overbill those who are insured to make up the difference.

    In NY, where there is community rating, a couple pay about $22,000 per year for health insurance. This is what will happen under PPACA. Are you telling me this is how it should work?

  8. redwave,

    Oddly enough, most of the world does manage to afford exactly what you claim no one can afford.

    You are correct that where we are headed is not, in any real sense, insurance. That's because we, as a society and just like every other society that approaches our level of wealth, have made a determination that we are not going to allow certain medical expenses to go uncovered. That may not be the economically efficient decision to have made, though I think it is more so than first order thinking would indicate, but rather a moral one. Unless you are prepared to go to a world in which no one calls an ambulance for an accident victim until they have checked to make sure that the victim can pay for the service, the free market model breaks down. That may have been how things worked once upon a time, but almost everyone considers it to be a significant improvement that they no longer do.

    And, as I said, it seems to work everywhere else. They either get universal coverage about as good as what covered people here get for somewhat less cost, or, if they are Britain, get universal coverage that is a bit less good than ours for a lot less cost. There are reasons to think that health care in the US won't become as cheap as it is elsewhere, but that's for other reasons, not community rating or universal coverage.

  9. @redwave: Are you unaware of deductibles and copays? In my state, for example, a typical individual policy requires paying the first $2K of costs each year (except for office visits, which are $30 a pop plus the cost of any tests or other treatment, or prescription medicines, which are covered at about 40%). The cost for such a plan for a family, no community rating: about $21K, unless you actually need care, in which case the total cost ends up somewhere between $25K and $40K.

  10. Mr. Neal, I guess to some degree, whether a system is working or not is in the eye of the beholder. My assessment is that it's not working anywhere, and it's not sustainable, either. I expect we won't get anywhere debating that.

    Paul, you make my point for me. Comprehensive plans are simply unaffordable, and as you point out, the all in costs make the picture look even worse. A major medical approach, whether provided to individuals on a voluntary basis or in employer, association or other group settings is the only economic model that features an actual insurance component (as opposed to an administrative, bill paying one) and might be sustainable. And yes, I understand the implication that we won't be able to provide every possible treatment for every patient, but since I am not a socialist, that does not trouble me so much. I think charities and other sources will provide voluntarily for those treatments that make sense. I also understand the prevailing sentiment on this blog is that taxpayers should in fact pay for every possible treatment anyone wants. Europeans are starting to get an actual sense of the societal costs for doing that. By rejecting the public option, and now cutting back on what was passed, Congress is reflecting the prevailing American determination that we don't want to go that far either. This is before we even start talking about the medicaid crisis in the states.

  11. Redwave: Did you change the point you were making? My point is that in a non-community-rated state, people are in essentially the same position as in the community-rated state you deplore. And the "major-medical" approach is (thanks to deductibles and copays) essentially what we have already. The higher-deductible plans (say, $10-15K deductible, $25-30K out of pocket limit) in my state are somewhat cheaper than the lower-deductible ones, but still not what you would call affordable.

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