GOOD TO KNOW: Federal high-risk insurance pool

In June, as a consequence of the Patient Protection & Affordable Care Act, Medicare began issuing $250 Medicare rebate checks for those Medicare beneficiaries entering the Medicare Part D donut hole. July brought with it another change as a result of the act’s passage: the establishment of a federal high-risk pool.

What is the federal high-risk pool? What are the eligibility requirements? What does it offer and when does it start?

All excellent questions!

What’s the federal high-risk pool?

The federal high-risk pool is a program for people who have been without health insurance for at least six months and who have a pre-existing condition that prevents them from obtaining health insurance on the private market. The purpose of the program is to provide health insurance coverage to people who cannot get coverage due to pre-existing conditions until 2014 when all insurance companies, by law, will be prohibited from denying coverage based on pre-existing conditions. Wisconsin is slated to receive approximately $73 million under the Patient Protection and Affordable Care Act to establish and maintain a pool for these individuals from now until 2014.

If the description of the federal high-risk pool sounds familiar, that’s because Wisconsin already has its own high-risk pool, HIRSP. Wisconsin has decided to implement the federal high-risk pool through HIRSP. HIRSP covered services include:

• Medical-surgical services • Anesthesia services • Consultations • Prescription drugs • Home care • Radiology services • Laboratory services • Pap test and pelvic exam • Prostate cancer screening • Skilled nursing care • Hospice care • Services and supplies for treatment of diabetes • Yearly routine exam The HIRSP Federal Plan will not have pre-existing waiting period.

How much will the federal risk pool premiums be?

No numbers have yet been released, but the premium for the federal pool will be based on standard market rates for individual health insurance. (In other words, the premiums will be no higher than the average person of the age of the federal pool applicant would pay for insurance in the private market.)

The premium rates for the federal pool are expected to be lower than the full HIRSP premium rates. However, those with household income below $33,000 may be eligible for an HIRSP premium subsidy, which might make the HIRSP premium lower than the federal pool premium.

When will the federal pool be available? The earliest date applications would be available for the federal plan is July 2010. The earliest date coverage could be effective for the federal plan is Aug. 1, 2010.

What are the eligibility requirements for the federal pool? To be eligible for HIRSP Federal: 1) You must be without creditable coverage for six months and, 2) be a citizen or national of the United States or be lawfully present and, 3) have a pre-existing medical condition.

What’s creditable coverage?

Creditable coverage is coverage under qualifying group health plans and insurance from any of the following: a group health plan; health insurance coverage; Medicare Parts A, B and D; Medicaid; TriCare, formerly the Civilian Health and Medical Plan of Uniformed Services (CHAMPUS); Civilian Health and Medical Plan of the Veterans Administration (CHAMPVA); a medical care program of the Federal Indian Health Service or of an American Indian tribal organization; a state health benefits risk pool (HIRSP); a federal employee health plan; a public health plan; a Peace Corps health plan.

What’s a pre-existing condition?

The federal definition of a pre-existing condition has not yet been determined; however, it is likely that the definition will be the same as, or very similar to, HIRSP’s. Generally, HIRSP applicants must produce evidence of uninsurability due to a pre-existing medical condition. Typically this proof is a rejection letter from an insurer.

What if I’m on the BadgerCare Plus Core waitlist? If you are on the BadgerCare Core Plan waitlist, you will not lose your place on the BC + Core Plan waiting list if you enroll in the HIRSP Federal Plan. However, if you enroll in the BC + Basic Plan or BC + Core Plan first, you will not be eligible for the HIRSP Federal Plan. (BC + Basic is a new, bare-bones insurance program available only to people on the BadgerCare Core Plan waitlist.) To be eligible for the HIRSP Federal Plan, you must be uninsured for the past six months. Enrollment in HIRSP or any BadgerCare Plus program now will prevent you from enrolling in a federal pool when it becomes available, because a person cannot have been insured within six months before enrolling in the federal pool.

Are HIRSP and the federal high-risk pool the same thing?

No! It is important to note that the new federal high-risk program will not replace Wisconsin’s existing HIRSP program. HIRSP will remain in operation, serving its existing clients and accepting new enrollees. Unfortunately, those currently enrolled in HIRSP do not qualify for the federal program because they are currently insured.

Wisconsin HIRSP will administer both the federal risk pool and Wisconsin’s HIRSP. They will have very similar, if not identical, benefits and eligibility criteria. The federal risk pool is expected to have lower premiums, but that may not be the case for individuals with annual income less than $33,000.

How can I apply for the federal high-risk pool?

Information about applying is available on www.hirsp.org and at HIRSP’s customer service line 1-800- 828-4777.

If you have any additional questions, you may call Pat Hafermann, elderly benefits specialist with the Aging and Disability Resource Center, at (920) 467-4076.

Resource: “The Specialist” June 2010