18 States reject Obamacare high-risk insurance pools

Just wanted to update you on a post I wrote last week regarding the division of the states on participation in Obamacare high-risk insurance pools.  The Washington Post is reporting today that eighteen states have declined to administer the federally-subsidized programs:

Eighteen states have said they will not administer a stopgap program to provide insurance coverage to people whose preexisting conditions have left them uninsured, forcing the federal government to do the work.

The states' decisions increase the challenge the government faces as it sets out to translate the far-reaching health-care legislation into action, and they hint at the complexities to come.

At issue is a provision to extend temporary relief to people with preexisting medical conditions beginning this year, instead of making them wait until 2014, when insurers will be prohibited from turning people away or charging higher premiums based on health status. The health-care law sets aside $5 billion for the "high-risk pools."

Health and Human Services Secretary Kathleen Sebelius told state officials last month that she wanted to build on state programs, and she asked state governments to let her know by April 30 whether they would run the pools at the state level.

As of Monday, 29 states plus the District of Columbia had said they would do so, and 18 said they would leave the job to HHS. Others were undecided.

Some governors said they were unwilling to take on the task because it appears that Congress has allocated too little money.

Twelve of the eighteen states that have refused to participate already have high-risk insurance pools.  People currently insured under those programs would be ineligible for what is expected to be the lower cost federally-subsidized insurance.  States with existing high-risk pools would be prevented by law from decreasing their expenditures on these programs if they agree to administer the federal program.  In addition, the chief actuary at the Centers for Medicare and Medicaid Services has predicted that the $5 billion allotted for the new program will run out as early as next year, but the states will be required to insure pool participants until 2014.

It is not surprising that so many governors have refused to take ownership of this disaster lying in wait.