Posted January 22, 2017 04:33 pm - Updated January 23, 2017 12:50 am
By Justin Wingerter email@example.com Topeka Capital Journal
Kansas’ high-risk health care pool, dormant for years, may return as an Obamacare alternative
If congressional Republicans repeal the Affordable Care Act before they replace it, they may revive a costly Kansas program that exists on paper but has been inoperative for several years.
Between the late 1990s and the end of 2013, the state’s insurance department operated a high-risk pool for people unable to obtain health insurance due to pre-existing conditions, spending state tax dollars to ensure a relatively small number of residents — primarily middle-class Kansans suffering from cancers and rare diseases — received coverage for expensive treatments.
The Affordable Care Act, with its protections for those with pre-existing conditions, made most high-risk pools obsolete. Though Kansas hasn’t used a high-risk pool since 2014, the state statute that created the pool and dictates its functions remains in place.
U.S. Rep. Roger Marshall, a Kansas Republican and one of 15 physicians in Congress, would like to see high-risk pools, in tandem with other programs, bridge the gap between a repeal of the ACA and a replacement.
“We’re not going to push anybody off of the cliff,” Marshall said in an interview last week. “We have 90,000 Kansans on the exchange right now, and we’re going to make sure there’s a transition period for those people to go to different alternatives, including a high-risk pool.”
Michael Byerly, a spokesman for U.S. Rep. Lynn Jenkins, said the Republican congresswoman “is open to considering how we fund high-risk pools run by the states.”
“Thank goodness Kansas still has a high-risk pool in law,” Marshall added. “I would be scrambling if I was a governor who didn’t have high-risk pool legislation set up. This high-risk pool will be funded with federal block grants and it will also be funded somewhat locally as well.”
The logistics of such a proposal are unprecedented and could prove difficult. In 2013, the last full year a high-risk pool was used in Kansas, 1,375 people took part, according to Bob Hanson, a Kansas Insurance Department spokesman. Marshall would like to move a quarter of the Kansans on the ACA exchange to high-risk pools — about 22,500, by his estimates.
Linda Sheppard, a senior analyst at the Kansas Health Institute who previously worked at the insurance department, said there has never been more than 2,000 Kansans in the high-risk pool and, because the state was able to charge higher premiums than private insurers, low-income Kansans were priced out of the pool. Premiums that were capped at $500 from private insurers, for example, could go as high as $750 in the high-risk pool.
“It was a viable option for people who had the financial wherewithal to be able to pay those premiums,” Sheppard said. For everyone else, however, the high-risk pool was off-limits.
The high-risk pool in Kansas was never self-sustaining, even when it exclusively served those who could afford costly premiums. For every dollar the state took in through premiums and a fee on private insurers, it paid out more than twice that, Sheppard said.
“Is the federal government going to subsidize the pool to such an extent that people are going to be able to afford those premiums to take part in the pool? That’s really the question,” she said.
Kansas’ high-risk pool was operated by a third-party administrator, Benefit Management Inc. The company is located in Great Bend, where Marshall lives and where he announced his candidacy for Congress in 2015. BMI founder Dennis Call donated $1,000 to Marshall’s campaign that May.
In 2010, a University of Kansas study tracked 42 suburban, middle-class enrollees in the state’s high-risk pool. It found “high premiums and deductibles limit participants’ ability to afford basic health services and access to prescription medications.” Enrollees forewent treatments and employed “potentially dangerous strategies to minimize costs, especially for prescription medications,” according to the study.
In the years that followed, Kansas briefly had two functioning high-risk pools. In addition to the state-run pool, there also was a temporary federal pool funded entirely by federal grants. When those funds were tightened, however, the state had to restrict enrollment to cut costs, according to Sheppard. A former website for the federal pool in Kansas has since been turned over to a Japanese company.
President Donald Trump has stated his support for high-risk pools, including it on his campaign website as an alternative for people currently covered under the ACA. House Speaker Paul Ryan, R-Wis., and U.S. Rep. Tom Price, R-Ga., Trump’s choice for health and human services director, also support high-risk pools.
Marshall said he has spoken to Price a dozen times in the past year about replacing the ACA and was impressed on each occasion, calling him “a man of God and a modern-day Marcus Welby.” Marshall said he has spoken just as many times to Kansas insurance commissioner Ken Selzer about re-establishing the state’s high-risk pool. Hanson, a spokesman for Selzer, said nothing has been finalized.
“Reenergizing the high-risk pool as part of a partial replacement for the Affordable Care Act’s coverages has been discussed in governmental conversation, but the proposition is just that — a proposition,” Hanson said.
Byerly said Jenkins supports several other propositions, such as allowing dependents to remain on their parents’ health care plan until the age of 26 and expanding use of health care savings accounts. Jenkins, in a statement, said she favors implementing a “patient-centered replacement plan” when the ACA is repealed.
Marshall expects high-risk pools to be one of five to 10 alternatives to the ACA established by congressional Republicans who have spent much of the past decade railing against and attempting to repeal the 2010 health care law. He said the biggest challenge before Congress right now is “how do we not push people off the edge.”
“It’s going to be OK,” Marshall said. “There’s going to be a period of transition to give the insurance companies enough time to write the policies. But it’s going to be OK.”