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Feds give Missouri $81 million for state high-risk insurance pool

This article first appeared in the St. Louis Beacon, May 4, 2010 - Missouri will get $81 million in federal money to set up an affordable health-insurance pool for residents with pre-existing conditions and without coverage for at least six months. The new program is part of a $5 billion nationwide high-risk pool created by the health-reform law, the Patient Protection and Affordable Care Act.

Missouri is unsure how many people will be insured through the new pool, says Travis Ford, spokesman for the Missouri Insurance Department.

"Our job will be to take the actuarial information and make this (funding) last for about three, three and a half years, or as long as we can make it last," he said. Missouri doesn't expect to receive any more money for the high-risk pool during that time.

The 3 and 1/2 year window refers to 2014, the year most reforms in the new federal law take effect. Then, in theory, the law will make health insurance affordable for everyone. The new pools beginning in July are a stopgap measure to help hardship cases.

A spokesperson for the federal Department of Health and Human Services says that these pools seek to address a problem in 45 states -- including Missouri -- where "insurance companies can discriminate against people based on their pre-existing conditions, leaving many Americans unable to get health insurance."

The cost for the new program will be substantially less than what people now pay for the state's high-risk insurance pool -- about 130 percent of what healthy people might pay for health insurance, Travis said. The new program, limited to people uninsured for at least six months, would charge rates no higher than what healthy Missourians are charged. Missouri's pool can absorb the cost of charging less, Ford says, because all the money is coming from the federal government.

Even so, some states are wary, arguing that the $5 billion is insufficient, and that a shortfall could cause taxpayers to pick up the tab.

That's Georgia's argument for refusing to set up its own pool. Georgia's insurance commissioner, John Oxendine, told the Associated Press that state taxes could be imposed to cover the shortfall and that he didn't want to impose on the state's taxpayers "something that's going to be a burden on them."

Missouri apparently has no such concerns. The state will let the Missouri Health Insurance Pool manage the new pool. In a letter last week to Health and Human Services Secretary Kathleen Sebelius, Missouri's insurance director John M. Huff says MHIP can do the job because it "has nearly 20 years of experience in the design, implementation and management of a high-risk pool for Missourians."

Ford said the state didn't anticipate hiring more employees. "The main thing is that we think the pool can be run better from Missouri than from Washington," Ford said.

The federal government will set up and run pools in states like Georgia that don't set up their own programs. Indiana, Minnesota and Nebraska are among about 15 states that have chosen not to set up their own pools.

Other health-care reforms taking effect this year include:

  • A small business tax credit of 35 percent of an employer's contribution for providing health insurance for some workers.
  • A prohibition against pre-existing exclusions in policies for children.
  • A provision to allow parents to keep coverage for their children up to age 26. 
Robert Joiner has carved a niche in providing informed reporting about a range of medical issues. He won a Dennis A. Hunt Journalism Award for the Beacon’s "Worlds Apart" series on health-care disparities. His journalism experience includes working at the St. Louis American and the St. Louis Post-Dispatch, where he was a beat reporter, wire editor, editorial writer, columnist, and member of the Washington bureau.

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