Last month, the U.S. Senate passed the State High Risk Pool Funding Extension Act of 2004, legislation that extends high-risk pool funding from the federal government to the states.
Senate Bill 2283 provides $15 million in seed-grant funding through 2005, and $75 million in grants for the funding of pools through 2009. Last year, more than 172,000 people nationwide, representing combined medical claims of more than $1 billion, were covered through high-risk pools.
“If it passes, it’ll essentially ensure continued stability for Mississippi’s program,” said Lanny Craft, executive director of the Mississippi Comprehensive Health Insurance Risk Pool Association. “Whether we get federal funds or not is immaterial. Our funding process is sound. If we are fortunate enough to get federal funds, that will be good. If not, it won’t be detrimental to the program or policyholders.”
Connecticut and Minnesota were the first states to create high-risk pools in 1976. Over the next 14 years, a smattering of states set up similar programs, but it wasn’t until 1991 that Mississippi lawmakers pioneered a funding mechanism that did not require public funds.
“We’ve been successful since we issued the first policy in 1992,” said Craft. “It’s not a welfare program. It doesn’t cost Mississippi taxpayers money. In fact, our funding methodology is now a template for some states.”
A statutory assessment against the insurance industry of $1 per month for each health insurance policy subsidizes the Mississippi Comprehensive Health Insurance Risk Pool Association, which has about 4,300 members.
“We’ve helped thousands of people over the years bridge the gap,” said Craft. “Our enrollment remains steady, but there’s a 20% to 25% turnover every year. Some members are getting older and qualify for Medicare, some are getting healthier and are better able to buy conventional insurance, and others are going to work where they can buy into the company’s group insurance.”
People included in the high-risk pool — those who want health insurance but are unable to purchase it — typically represent early retirees, small businessmen, farmers and even lawyers and doctors that are sole practitioners.
“Besides members having access to health insurance, the pool makes them eligible under HIPAA,” said Craft. “If someone has been in our program for 18 months and finds access to group coverage, he or she can slide into that group coverage and normally have the waiting prior for pre-existing conditions waived.”
To enroll in the Mississippi Comprehensive Health Insurance Risk Pool Association, applications are generally made through a state-licensed insurance agent. “However, there are some instances in which we’ll take applications directly, for instance, from Mississippians living in isolated areas without agents or those living in small towns that do not want their medical condition widely known,” said Craft.
Ron Aldridge, state director of the National Federation of Independent Businesses, said the high-risk pool definitely helps people who cannot otherwise get insured.
“It’s high, but at least you can get insurance,” he said. “Maybe we need to look at expanding the program.”
Of the 30 states that have high-risk pools for uninsurables, most states rely heavily on federal grants.
Congress will take up the high-risk pool legislation in the next session. The U.S. House of Representatives had a similar bill that died (HR 5341) and did not take action on the Senate version that passed. The House did not want to agree to the Senate language but wanted a one-year extension to work on a longer-term, broader bill, according to the Council for Affordable Health Insurance.
“I got a report (earlier this month) and there’s no anticipation of any of them becoming law next year,” said Lee Youngblood, spokesperson for U.S. Sen. Trent Lott (R-Miss).
Contact MBJ contributing writer Lynne W. Jeter at firstname.lastname@example.org.