The Obama administration predicted that hundreds of thousands of people would enroll in the Pre-existing Conditions Insurance Plan (PCIP), but the actual enrollment only totaled 8,011 as reported November 5, 2010.  As a result, the Department of Health and Human Services (HHS) announced the federally-administered PCIP program will expand the one option offered in 2010 to three options in 2011: the Standard Plan, the Extended Plan and the Health Savings Account eligible plan.  In addition, families will be able to enroll their eligible children age 0-18 in PCIP at child-only rates. 

2011 Standard Plan

• 2010 Standard Plan had a single, combined medical and pharmacy deductible of $2,500. 
• 2011 Standard Plan has been improved and now has two separate deductibles – a $2,000 medical deductible and $500 drug deductible, while also offering premiums that are almost 20% lower than the 2010 premiums. 

 2011 Extended Plan

• $1,000 medical deductible and $250 drug deductible
• Premiums for 2011 Extended Plan will be slightly higher than 2010 premiums
• Separate drug and medical deductibles makes this plan option more valuable for those taking one or more maintenance medications

Health Savings Account Option

• $2,500 deductible
• Premiums are 16% less than 2010 premiums
• This option is eligible to receive favorable tax treatment by the federal government when used with a Health Savings Account (HSA). 

What does this mean to you?

All Americans should have the opportunity to purchase health insurance, and PCIP serves that purpose to those suffering from pre-existing conditions until the exchanges begin in 2014.  However, there are two areas of concern I would like to address as they impact those with insurance in the private sector. 

First, it is interesting to me that the government is willing to provide care to individuals with significant health problems using your tax dollars, and arbitrarily set the rates at a point they think more people will enter the market as opposed to looking at risk they assume.  I do not understand their logic of simply reducing premiums by as much as 20%.  If reducing premium is the government’s idea of driving more individuals into the pool, the result is greater exposure to risk with less premium coming in to cover that risk.  How long can you support that logic?  Would it not make more sense to loosen the restrictions on one’s eligibility to get in to the pool while keeping the premiums where they are?

Second, how can an individual with costly pre-existing conditions obtain coverage through the government’s PCIP for a lower premium than a healthy individual can through the private sector?  Government subsidies through tax dollars, of course.  Would you be frustrated to learn that your private health insurance may cost more than the high-risk pool?  Compare your monthly premium to the 2011 PCIP premiums for South Carolina below and let me know how your numbers stack up.  For more information about benefits, rates, and the application, please visit www.pcip.gov.