What is a risk pool?
Health insurance risk pools are special programs created by state legislatures to provide a safety net for the "medically uninsurable" population.
These are people who have been denied health insurance coverage because of a pre-existing health condition, or who can only access private coverage that is restricted or has extremely high rates.
(Normal people are not allowed to join, although "public option" may add coverage for the unemployed or self employed to those clearly allowed to join, the sickest, IF they can afford the high premiums.)
* Each of the state risk pool-type programs is different. Generally, the programs operate as a state-created nonprofit Association overseen by a board of directors made up of industry, consumer and state insurance department representatives.
Oregon's Healthcare Lottery: A US state is running a lottery in which the prize is health insurance. (BBC World News)
The board contracts with an established insurance company to collect premiums and pay claims and administer the program on a day-to-day basis. Insurance benefits vary, but risk pools typically offer benefits that are comparable to (MORE EXPENSIVE) basic private market plans -- 80/20 major medical and outpatient coverage, a choice of deductible and co-payments. Maximum lifetime benefits vary by state from as low as $350,000 (thats way too low) to $2 million. (thats still too low in the case of a really serious illness)
* Generally, (once one is qualified to join by uninsurability elsewhere) there are no exclusions. However, risk pools do have waiting periods for coverage of pre-existing conditions to make sure individuals pay for continual coverage and the program can operate financially sound. Without waiting periods, the concern is that too many people could forego paying for insurance until they had a high cost claim, and the programs could not function financially. However, under the federal portability legislation, people who have had continuous coverage in the group market, not broken by more than 63 days, can access coverage in risk pools without any waiting periods. (in reality many of the state risk pools are perennially bankrupt or on the edge of bankruptcy.. some have long waiting lists, even though they are very expensive- check with your local state office for your situation. In Oregon, they have a lottery. If you win, you can pay $2000 a month for high risk insurance!)
* Risk pool insurance generally costs more than regular individual insurance, but the premiums are capped by law in each state to protect the individual from exorbitant costs. The caps range from as low as 125 percent of the average (for COMPARABLE private coverage) in some states, up to 200 percent of the average or more in other states. Most states offer coverage at less than 150 percent of the average.
* All state risk pools inherently lose money and need to be subsidized. While the individuals in risk pools pay somewhat higher premiums, roughly 50 percent of overall operating costs need to be subsidized. Subsidy mechanisms also vary from state to state -- some states assess all insurance carriers, HMO's and other insurance providers; others provide an appropriation from state general tax revenue; some states share funding of loss subsidies with the insurance industry using an assessment of insurance carriers and providing them a tax credit for the assessment, or other states have a special funding source, such as a tobacco tax, or a hospital or health care provider surcharge.
* It is important to note that risk pools are not created expressly to serve the indigent or poor who cannot afford health insurance. Risk pools are designed to serve people who would not otherwise have the right to purchase health insurance protection. The indigent can access coverage through state medical assistance, Medicaid or similar programs. However, some state risk pools do have a subsidy for lower income, medically uninsurable people.
* For information about your state, see "States That Have Risk Pools" or contact your state insurance department.
Description by the National Association of State Comprehensive Health Insurance Plans (NASCHIP) "What is a Risk Pool"
I think the point needs to be made, so I'm making it here, that in high risk pools, is the real model that shows what public option might easily be - for all to see and evaluate, We have had this model all along, but that THEY - meaning politicians, the media, the illness cartel, and the public optional's de-facto minister of propaganda Celinda Lake DON'T WANT US LOOKING AT THAT LOGICAL EXPLANATION BECAUSE ITS A FAILING MODEL..
How will we allocate the limited number of spots for the sick in a money losing Public Option Risk Pool?
I think we will end up with something like a draft lottery.
If your date comes up, you will be able to get married, have children, perhaps even retire. If not, well, if you had skills, you could emigrate, before your debt made that impossible. Or mandatory.
Those who do not remember the past are doomed to repeat it.
NY Times: Drawing Lots for Health Care
BEND, Ore. — Last month, right after he had the heart attack and then the heart surgery and then started receiving the medical bills that so far have topped $200,000, Melvin Tsosies joined the 91,000 other residents of Oregon who had signed up for a lottery that provides health insurance to people who lack it.
Melvin Tsosies is among Oregonians who signed up for a health insurance lottery. "They said they’re going to draw names, and if I’m on that list, then I’ll get health care," said Mr. Tsosies, 58, a handyman here in booming Deschutes County. "So I’m just waiting right now."
Despite the great hopes of people like Mr. Tsosies, only a few thousand of Oregon’s 600,000 uninsured residents are likely to benefit from the lottery anytime soon. The program has only enough money to pay for about 24,000 people, and at least 17,000 slots are already filled.
"Maybe we can hope that as time goes on," said Jim Edge, the state Medicaid director, "there will be state money added back to this program and it can grow again."