As the Republican party continues it’s internal discussions about how best to renew the effort to repeal the Affordable Care Act (after they stopped playing political hot potato with the downright awful AHCA), one key option that the GOP will look to for support is reestablishing the existence of high-risk insurance pools.
Except that there’s a bit of joke about these things—one that Mark Meadows, a Republican congressman and leading man for the ultra-conservative House Freedom Caucus seems to understand:
When asked how much money to give to high risk pools, Meadows jokingly checks his wallet.
— Robert King (@rking_19) April 4, 2017
For those unfamiliar, before Obamacare banned insurance companies from declining customers based on pre-existing conditions, many states had high-risk pool programs for those who could not find health care coverage in the non-group market. As the Kaiser Family Foundation’s Drew Altman explains, however, those programs in practice mostly showed how grossly inadequate they were to the task:
Before the passage of the ACA, 35 states operated high-risk pools for people in the non-group market who could not get standard coverage. The performance of these pools was so anemic that their total enrollment across these states peaked at 226,615 in 2011. Perhaps surprisingly, nearly all of them excluded coverage for pre-existing conditions for a period of time–usually six months to 12 months–while providing other coverage for the enrollee. If this seems counterintuitive to you, join the club; wasn’t coverage for pre-existing conditions the main point?
Past experience shows that any strategy to split the risk pool into the healthier and the sick and set up state high-risk pools as the fallback for high-cost patients who lose coverage will require new rules that protect people with pre-existing conditions immediately when their coverage starts, eliminate lifetime caps, and have adequate funding if policies are to be affordable and the large losses are to be avoided.
Emphasis in bold are mine. It’s the joke that Mark Meadows believes is funny, because these things were never adequately funded.
I mean, look, this is the way insurance generally works (very basic, skip if you already grasp this): a group of people (‘the pool’) pay money into a pot (or, a company) to hedge against the risk of needing a particular good or service. A so-called healthy pool would be a sustainable mix of folks who do not need that good or service and those that do. Which means at any given time those folks that don’t need help subsidize, or completely cover, the others that do need help.
Creating an insurance pool that primarily consists of sick people who need to constantly use their coverage means that their premiums—even if they are above average—don’t cover the total cost of care, so the program needs some other funding stream to balance payouts. In this case that other funding came from the states themselves, yet because medical care in America costs an absurd amount of money it also cost the notoriously cash-strapped states an absurd amount of money. As a result these programs often had shortfalls in the billions of dollars, a deficit that they usually wouldn’t even try to cover (even with some minimal federal grant help). As a result they just left them chronically under-funded, and overly restricted (for example, check out this overview from a presentation on North Carolina’s high-risk pool in 2008), these programs to the point of uselessness.
Theoretically, high-risk pools could work if they were fully funded with minimal obstacles to enrollment. Although I should point out that the ACA actually created a temporary version of this and still struggled to sign people up for the care they needed.
So this is the type of thing that some Republicans will look forward to reintroducing in order to side-step claims that under an AHCA-like reform the chronically ill wouldn’t be able to receive care. Say that, in the process of replacing Obamacare, they effectively remove the prohibition against denying policies to folks with pre-existing conditions (there are several ways to do this). “But it’s okay!” they claim, because we’re also setting aside federal funding for these state-based high-risk pools. Everyone in the health policy world would know right away that they almost certainly wouldn’t set aside enough for these programs to truly meet the needs of people their own reform are going to dis-insure. But your average jane or joe won’t know that beforehand, and your average voter will take whatever cue they get from party figures spinning the inevitable result.
This is the part that I fear. That the return of these failed vehicles for providing care allows people like Mark Meadows to dissemble long enough to enact whatever dystopian replacement they eventually settle upon. That it would provide enough cover for them to promise people with pre-existing conditions that they’ll still be able to get insurance—even as they’ll wordlessly pull out their wallet to show they know how much of cruel joke it really is.