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What Are 'High-Risk Pools' And Do They Lower Health Care Costs?


Most legislators in both parties say that people with pre-existing conditions, such as cancer, cerebral palsy, epilepsy, kidney disease or stroke, should have health care coverage. This was more or less guaranteed under President Obama's Affordable Care Act. But many Republicans say that kind of blanket coverage has driven up health care prices for everybody. To pass their health care replacement bill, House Republicans added 8 billion dollars over five years to put people with pre-existing conditions into what are called high-risk pools. They might pay higher rates for health insurance, but some of that extra cost would be covered by that $8 billion. And there's another $100 billion in the new bill that states can use as they like. So in theory, some of that money could be given to people who have high-risk health problems. We're joined now from Minnesota Public Radio by Ryan Burt. He's an attorney who specializes in high-risk pools. Mr. Burt, thanks for being with us.

RYAN BURT: It's my pleasure.

SIMON: That sounds like a lot of money potentially to cover people - high-risk people. Does it add up to you?

BURT: Well, I think there are a lot of unanswered questions that only time will tell. It's going to depend on how states set up their benefit plans, what kind of premiums they charge and a lot of other factors that I just don't think we know the answer to quite yet.

SIMON: Ideally, what problems do high-risk pools solve?

BURT: They were really designed to help a very narrow segment of society, individuals who have pre-existing conditions, but that at the same time, have some financial means that can help them afford to actually purchase health insurance. But if people are expecting them to solve all the problems for people who maybe are lower income or who are unable to work, I'm not sure that barring some very creative measures by states they'll be able to address those other areas outside of what they were - initially planned to address.

SIMON: When you say barring creative measures by states, do you mean barring states' willingness to pony up a lot of money?

BURT: That's one alternative, yes, contributing additional funds to help either subsidize premiums or subsidize losses, which I guess in the end is about the same thing.

SIMON: How have high-risk pools worked in your state, Minnesota?

BURT: Well, in Minnesota, the program was enacted way back in 1976, and there was a conscious decision made by the public policymakers in Minnesota to create a balancing act where the intent was to keep premiums as affordable as possible but obviously more than a standard-risk person would pay but also provide very, very good benefits so these people could actually get the type of care that they needed to address their conditions. The result was a significant need for outside funding, and the state decided that the best way to do that was to create an assessment upon the insurance industry to help subsidize the cost of the claims that were paid.

SIMON: The idea of high-risk pools is that they have the effect of lowering premiums for everybody across the board. Does that follow, do you think?

BURT: You know, that's a very difficult question to answer because there's such variability, both in the state of the market in the individual states as well as the design and the effectiveness of the pool within each state.

SIMON: I mean, if it hadn't been said already, I'm tempted to say I never knew health care could be so complicated (laughter).

BURT: Yeah. I think that's one thing that a lot of folks are really finding out.

SIMON: Does it suggest to you, though, at the same time that this is so complicated and so dense it really is difficult for even well-informed people to figure out what's best for them and their family?

BURT: Yes. I mean, I think that's a fair statement, but that's an area where the states can step in, where the regulators of the insurance markets in the state can require certain disclosures from companies, can require plain language to make it easier and understandable for folks to really understand what the impact could be on them depending on their health status, health care needs, all of those factors.

SIMON: Let me put you on the spot a bit, Mr. Burt. Is this a good bill?

BURT: I can't honestly say (laughter) and I know that's a little bit of a cop out. But the reason why that is is because it puts an awful lot of the onus, if not the majority of it, back upon the states to figure out how to best use the funding available. And then what are they going to do to help their own populations? But I think, again, it's really a state-by-state question as to how creative state legislators and others are going to be and what kind of solutions they can arrive at that will really serve their citizens.

SIMON: Is there one best-guaranteed way to lower premiums to narrow the amount of coverage of it?

BURT: There needs to be a balancing act. Certainly, paring down benefits would potentially or at least arguably lower costs. But where does that leave the citizens of the state or the citizens of our country that need certain types of care that maybe isn't going to be covered anymore?

SIMON: Ryan Burt, an attorney in St. Paul, Minn. Thanks so much for being with us, Mr. Burt.

BURT: It's been my pleasure. Transcript provided by NPR, Copyright NPR.