The U.S. Department of Health and Human Services (HHS) on June 1, 2011, announced steps to reduce premiums and ease enrollment in the federal Pre-Existing Condition Insurance Plan (PCIP). Premiums will drop as much as 40 percent in 18 states, and eligibility standards will be eased in 23 states and the District of Columbia to ensure that more Americans with pre-existing conditions have access to the plan, according to an HHS release.
The PCIP was created under the Patient Protection and Affordable Care Act (PPACA) and serves as a bridge to 2014 when insurers will no longer be allowed to deny coverage to people with any pre-existing condition, like cancer, diabetes and asthma. “These changes will decrease costs and help insure more Americans,” said HHS Secretary Kathleen Sebelius.
PCIP provides comprehensive health coverage, including primary and specialty care, hospital care, prescription drugs, home health and hospice care, skilled nursing care, and preventive health and maternity care. It limits annual out-of-pocket spending, and those who enroll are not charged a higher premium because of their medical condition.
In 23 states and the District of Columbia, the PCIP program is federally administered. The remaining states operate their own PCIP programs using federal funds provided by the PPACA. (This chart shows changes to PCIP premiums in the states with federally administered PCIP programs.)
Other changes will make enrolling in the federally administered PCIP in 23 states and the District of Columbia easier. Starting July 1, 2011, people applying for coverage can simply provide a letter from a doctor, physician assistant or nurse practitioner dated within the past 12 months stating that they have, or had at any time in the past, a medical condition, disability or illness. Applicants will no longer have to wait on an insurance company to send them a denial letter. This option became available to children under age 19 in February 2011, and it is being extended to all applicants regardless of age.
Applicants will still need to meet other eligibility criteria, including showing that they are U.S. citizens or reside in the U.S. legally and that they have been without health coverage for six months.
To further grow the program, beginning in fall 2011 HHS will begin paying agents and brokers for successfully enrolling eligible people in the PCIP program. This is a part of continuing HHS outreach efforts with states, insurers, providers, and agents and brokers to enroll more eligible people. HHS is working with insurers to notify people about the PCIP option in their state when their application for health insurance is denied.
PCIP enrollment reached 18,313 as of March 31, 2011, the Obama administration announced—considerably lower than the 400,000 enrollees in 2011 that had been predicted by Medicare's chief actuary when the health care reform law was passed.
Stephen Miller, CEBS, is an online editor/manager for SHRM.
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