High Risk Pool Enrollees Get a Reprieve – and We Have Answers to What’s Next.

Last week, the Administration announced plans to extend coverage under the Pre-existing Condition Insurance Plan (PCIP) until January 31, 2014, to allow enrollees more time to transition from PCIP coverage to coverage in a health insurance marketplace. For these patients and others in the thirty-five state-run high risk pools, making the transition without any lapse in coverage will be critical. As we noted in an earlier blog, high risk pool enrollees will have to coordinate the end of that coverage with the start of coverage in a marketplace in order to qualify for premium tax credits and maintain continuous coverage.

CHIR recently released a Navigator Resource Guide that includes 237 FAQs addressing private insurance coverage, including a chapter that covers issues for young people, as noted here. One chapter is devoted to high risk pool enrollees. Below we excerpt the FAQs from that chapter for those high risk pool enrollees who are considering their options and planning a transition to other coverage.

I got a notice from my insurance company that the high-risk pool is phasing out by the end of the year and I should sign up for coverage through the health insurance marketplace. What should I do?

You can sign up for coverage through a health insurance marketplace during the open enrollment period that runs from October 1, 2013 through March 31, 2014. However, to maintain coverage without a gap between your high-risk pool coverage and coverage in a health insurance marketplace, be sure to sign up in time for the coverage effective date to coordinate with the end of your high-risk pool coverage. For example, if your high-risk pool coverage will end on December 31, 2013 and you need coverage beginning January 1, 2014, you must enroll in a health insurance marketplace by December 23. This process includes applying for coverage and any premium tax credits or cost-sharing reductions you might be eligible for, selecting a plan and paying your first month’s premium.

I got notice that my high-risk pool plan is continuing into next year. Should I change plans or stick with my high-risk pool?

It depends. You may want to stay in your high-risk pool plan if you are in the middle of a course of treatment, or wish to continue to see a particular provider. However, staying in a high-risk pool has significant downsides that you’ll want to carefully consider:

  • High-risk pools don’t have to comply with the consumer protections of the Affordable Care Act. That means they can maintain annual and lifetime limits on benefits, don’t have to limit out-of-pocket costs, can limit benefits based on pre-existing conditions, and don’t have to comply with the minimum benefits standard required by the Affordable Care Act – all of which can mean individuals with significant health needs may be getting less from their coverage than they would under a plan that must comply with the Affordable Care Act rules.
  • Only those enrolled in a plan on the health insurance marketplace can qualify for financial assistance to reduce the cost of premiums and out-of-pocket costs. That can be a critical benefit for individuals in high-risk pool plans with high premiums and cost-sharing.

If I keep my high-risk pool coverage, does that count as coverage for purposes of the individual responsibility requirement (individual mandate)?

Yes, at least for 2014. Coverage through a high-risk pool will be considered minimum essential coverage in 2014 so you won’t be subject to an individual mandate penalty. However, high-risk pool coverage won’t automatically be considered minimum essential coverage in 2015 unless the high risk-pool in which you are enrolled provides consumer protections similar to those required by the Affordable Care Act.

For more information about coverage options and insurance market rules – for early retirees, employees, the uninsured and the just plain confused – take a look at the Navigator Resource Guide. Or stay tuned to CHIR Blog, where we will continue to post answers to commonly asked questions about private health insurance and marketplace topics.

Editor’s Note: Since the Guide was published, the Administration has made regulatory changes affecting when and how consumers should apply for coverage. For example, this blog has been updated to reflect the fact that the deadline for choosing a health plan was extended from December 15 to December 23, 2013.

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