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May 2010 St@teside

Planning for the Temporary High-Risk Pool Program Continues to Evolve


In early April, Health and Human Services (HHS) Secretary Kathleen Sebelius asked state officials to submit letters by April 30 stating whether they would run their own temporary high-risk pool programs or let HHS manage them. Since then, HHS has learned that 29 states plan to operate their own programs, while 19 states have chosen to let HHS run them.

As set forth by the Patient Protection and Affordable Care Act (PPACA), the temporary high-risk pool (HRP) program is designed to provide affordable health insurance coverage beginning in 2010 to people with pre-existing medical conditions. The program will serve as a stop-gap measure until 2014 when insurers will be prohibited from denying people coverage or charging higher premiums based on health status. The current federal appropriation for the program is $5 billion. To see the potential allocation of HRP funds, click here.

The 19 states that have chosen to have HHS run their pools are Alabama, Arizona, Delaware, Florida, Georgia, Hawaii, Idaho, Indiana, Louisiana, Minnesota, Mississippi, Nebraska, Nevada, North Dakota, South Carolina, Tennessee, Texas, Virginia, and Wyoming. Several governors cited the worry that Congress has allocated too little money as their reason for electing not to take on the task themselves. Rhode Island and Utah plan to notify HHS of their decision at a later date and Arizona has not yet announced its intention.

The HRP program allows states to choose one of the following five options:

  • Operate a new HRP alongside an existing HRP;
  • Establish a new HRP (in a state that does not currently have a HRP);
  • Build upon existing coverage programs designed to cover high-risk individuals;
  • Contract with a current Health Insurance Portability and Accountability Act carrier of last resort or other carrier, to provide subsidized coverage for the eligible population; or
  • Do nothing and have HHS carry out a coverage program in the state.


Many of the 29 states opting to establish their own HRPs already operate a high-risk pool. Consequently, they plan to use the administrative framework currently in place to run a new federally qualified HRP alongside the existing one. Some states in this category include California, Connecticut, Iowa, Kansas, Missouri, New Hampshire, North Carolina, Washington, and West Virginia.

Governors in Michigan, New York, Ohio, and Pennsylvania (all states without existing HRPs) explained that their administrations are working to assess possible options for the structure of the program. Maine, another state without a HRP, put forth its preference to run the insurance program through the Dirigo Health Agency, a plan in the individual market that has no waiting period for pre-existing conditions, assures mental health parity, and covers preventive services with no cost sharing. Meanwhile, South Dakota Governor Michael Rounds has proposed entering into an “administrative services only” arrangement where the state would offer all the administrative services associated with a high risk pool but is not willing to take on actions related to limiting enrollment, paying claims, or continuing coverage for enrollees as the funds are depleted.

As HHS and the states think through the variety of policy questions posed by this new insurance program, some of the key issues they are likely to consider include:

  • How will the currently envisioned federal HRP interact with existing state HRPs?
  • Given the variation among states, how will the new HRP requirements interact with current insurance market structures?
  • What is the impact if variation is allowed between those currently enrolled in state HRPs and the new populations that will be joining those pools?
  • What will be a state’s ongoing responsibility for the newly enrolled population if federal funding is insufficient?
  • Should certain data collection efforts be required to help provide insight into the development of future reform efforts both in terms of implementation processes themselves as well as whether these new populations’ needs are being met?

Many states have cited their interest in working with HHS to have their HRPs up and running by July or August. While states are concerned about the federal government’s ability to fund the HRP program until 2014, many state administrators are working tirelessly to create a partnership with HHS that will provide health insurance to a population that has found health coverage inaccessible for a very long time.




High-risk pool intent letters to Kathleen Sebelius from governors and other state officials in the following states:  California, Connecticut, Iowa, Kansas, Maine, Michigan, Missouri, New Hampshire, New York, North Carolina, Ohio, Pennsylvania, South Dakota, Washington, and West Virginia.

“HHS Says 29 States Opt to Operate Their Own Temporary High-Risk Pools,” BNA’s Health Care Policy Report, May 10, 2010.

Winerman, L.  “High-Risk Pools Set to Begin in July, But Funding, Fairness Questions Remain,” PBS, May 25, 2010.

Hilzenrath, D.S.  “18 States Refuse to Run Insurance Pools for Those with Preexisting Conditions,” The Washington Post, May 4, 2010.