High risk pools

Section 1101 of the Patient Protection and Affordable Care Act of 2010​​ (Pub. L. No. 111-148) provides for a temporary high risk pool program in each state and the District of Columbia. The program, known as the Pre-existing Condition Insurance Plan (PCIP), is meant to act as a bridge to provide insurance coverage to eligible individuals until 2014 when the ban against discriminating against individuals with pre-existing conditions becomes effective and the health insurance exchanges are required to be in place.

Eligibility Requirements for High Risk Pools:

  • A citizen or national of the United States or lawfully present in the United States
  • Uninsured for the previous six (6) months; and
  • Pre-existing condition

Five billion dollars ($5,000,000,000) in federal money has been allocated as funding for the high risk pool program to last through 2014.

Each state was given the option of either running its own high risk pool or allowing the federal Department of Health and Human Services​ to run a high risk pool in their state. (A list of each state's decision is available here.)

Arkansas's Implementation

Arkansas chose to run its own federally funded high risk pool alongside the state's existing high risk pool program – the Comprehensive Health Insurance Pool, authorized by Ark. Code Ann. § 23-79-501 et seq. The CHIP program is currently funded by premium taxes and assessments levied on insurance providers.

Arkansas will receive $46 million to run the PCIP (which will run alongside the existing CHIP plan). CHIP's actuary, Milliman, estimates that amount of funding will cover about 2,500 people through Dec. 31, 2013. Initially, CHIP will cap enrollment at 2,500 people and provide coverage on a first come, first served basis. However, CHIP may raise or lower that cap based on actuarial experience once the federal pool is up and running. The PCIP has a deductible of $1,000 and a $2,000 limit on out-of-pocket expenses for in-network services. Rates the PCIP must be set at the same level as those available in the standard (non-high risk) individual market pursuant to federal statute. The rates range from $156.08 per month for a non-tobacco user under 30 years of age to $807.20 for a tobacco user over 59. On average the rates will be about 33% less than the current CHIP rates. CHIP began providing coverage on Sept. 1, 2010. As of Feb. 1, 2011, the program had enrolled 147 people.

In May 2011, the U.S. Department of Health and Human Services reduced the premiums offered by the federally administered Pre-existing Condition Insurance Plan. It also allowed states operating their own plans, like Arkansas, to lower premiums. The CHIP board is currently analyzing rates with its actuary to determine whether rates can be adjusted.

Federal Documents

  • CBO Analysis pdf PDF
    The Congressional Budget Office estimates that $5 billion will cover the costs of about 200,000 new high risk pool enrollees. CBO believes that demand for the program actually will be higher and expects enrollment to be capped. Left uncapped, CBO estimates total spending probably would be between $10 billion and $15 billion, covering between 400,000 and 700,000 people each year.

  • HHS announces reduced premiums for Pre-existing Condition Insurance Plan web

  • HHS Secretary Letter pdf PDF
    Letter from the HHS Secretary requesting details about how states plan to implement the federal requirement regarding temporary High Risk Pools.

  • HHS Solicitation for State Proposals pdf PDF
    This solicitation provides guidance for states that choose to run their own High Risk Pool program and requests program descriptions and cost estimates from the states that select this option.

  • Interim Federal Regulations on High Risk Pools pdf PDF
    These interim final rules address how the federal high risk pool programs (also known as the Pre-Existing Condition Insurance Plans or PCIPs) can be administered in each state, who is eligible for coverage, the benefits that must be included, and acceptable methodology for calculating premiums.

  • Pre-existing condition insurance plan web
    Federal website for the pre-existing condition insurance plans

  • State-by-state enrollment web

Arkansas Documents

Other States' Documents

  • California AB 1887 pdf PDF
    California bill creating the Federal Temporary High Risk Health Insurance Fund. The bill only would be enacted if SB 227 is also approved.

  • California SB 227 pdf PDF
    California bill requiring for the state's existing high risk pool program to contract with the federal government to run California's Federal Temporary High Risk Health Insurance Fund alongside the existing program

Other Documents