Insurance director responds to AARP about Idaho opting out of high-risk pool

Insurance director responds to AARP about Idaho opting out of high-risk pool

by
Idaho Freedom Foundation staff
May 14, 2010
Idaho Freedom Foundation staff
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May 14, 2010

The director of the Idaho Department of Insurance said his agency advised Gov. Butch Otter to opt out of a new federally-funded high-risk health insurance pool for people with pre-existing medical conditions.  Director Bill Deal repeated statements by the governor’s office that the $24 million Idaho could receive for the fund during the next four years wouldn’t be enough to pay for providing insurance to more than 33,000 Idahoans and that taxpayers would end up paying for some of the program.

Deal wrote a letter to AARP Idaho Executive Director Jim Wordelman, who criticized Otter for not running the high-risk pool that’s part of new health care legislation approved by Congress earlier this year.  “Although the $24 million allocated to Idaho citizens will be used by HHS for Idahoans, clearly those funds could not wholly fund this program,” Deal said in the letter.  Deal also said that Idaho’s current insurance pool for people unable to find other health insurance, which covers 1,500 people who pay high monthly premiums, has $10 million in medical claims every year.

“Our research coincides with many other state officials and health experts who expect money will run out long before January 2014 raising concerns that states opting to run their own pools will be forced to foot the bill once the federal funds are exhausted,” Deal said.  The insurance pool for people with pre-existing conditions lasts until 2014, when new health care reforms intended to increase medical coverage would go into effect.

By not opting to run the insurance pool, the U.S. Department of Health and Human Services will carry out a coverage program for the state.  Deal said in the letter to Wordelman that other states that opted in to the program could impose new taxes on insurance plans, raising premiums for everyone.

Deal also wrote that the new insurance program wouldn’t apply to AARP members, which David Irwin with AARP Idaho disputed.  “There’s a large population of our membership that’s between the ages of 50 and 64 that’s still in the workforce and not of Medicare age and that still deal with a lot of the issues that most folks deal with when it comes to pre-existing conditions,” Irwin told IdahoReporter.com.  He also said that Idaho's missing out on an opportunity to create a state-specific insurance pool, and that he expects to see more foot-dragging from the governor.  "This is a step in the right direction.  We have to move beyond the politics of health care and get to the problems and how to address them for the people of Idaho."

Idaho is one of 18 states to opt out of the insurance pool.  Read Otter's comments about why he chose to opt out here.

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