Save Money - Lose The Texas High Risk Pool
Over the last few years I've written several articles about clients and friends with pre-existing conditions and their limited health insurance coverage options. In Texas, clients with significant health issues have only two options. First, if they own a small business and have at least one other employee, they could obtain a small company insurance plan or "group" plan. Many clients have gone this route, and we'll talk more about strategies for them next week when we post an article about evaluating cheaper options in the new year.
If the client didn't own a small business, they could apply for the Texas High Risk Insurance Pool. In this post we want to examine the High Risk Pool and detail what will happen to this important insurance backstop when "Obamacare" or the Affordable Care Act (ACA) goes live in the next few months.
What Is The High Risk Pool? Why Is It So Expensive?
The High Risk Pool is a Blue Cross Blue Shield administered plan that was set up by the Texas legislature and overseen by the Texas High Risk Pool board. The insurance provided by Blue Cross is very similar to any individual plan you can currently buy, BUT it is much more expensive because only applicants with serious past or ongoing health issues are in the pool. An example of the higher premium one might pay is that a 50-year-old male in Houston might pay $657 per month for a $5,000 deductible plan. A similar plan for the same gentleman with Blue Cross in the individual market would currently cost $265 per month! Clearly, there is an extra cost to the High Risk Pool as the health issues cause the premiums to be much greater!
The Sunset Of The High Risk Pool
With the creation and the implementation of the ACA, the Texas High Pool will be closed at year-end and the policy holders will be transitioned to other policies. Texans owning these policies should begin looking at the available alternatives on the market (when they are actually available!) to ensure that they examine all of their plan options. Click on our Get A Quote page for a free quote today!
As I first considered Blue Cross' actions, I assumed that they would be falling over themselves to keep these policy holders on a Blue Cross plan, but after further thought, I'm not so sure. Why wouldn't Blue Cross want them? Well, Blue Cross has 100% certainty of the kind of claims history these "sicker" folks have, so if the medical claims are actually much greater than what Blue Cross will be allowed to charge in the new Obamacare pricing environment, we might actually see Blue Cross happy to lose these customers! We'll know more soon.
Examine All Options!
My guess is that Blue Cross will actually make offers to transition policy holders over into a new policy, but, it is important for clients to look at the entire universe of plan and company offerings. Cigna, Humana, Aetna, and United Health will still be active in Texas, so it makes sense to try to find the best coverage at the most affordable price. Our firm sells a tremendous amount of Blue Cross policies, but we still believe that every client should examine the pricing and plan landscape every year even if they keep the same plan. Why should this transition process be any different?
Remember, clients that don't make enough income to exceed certain income levels may even qualify for help paying premiums so you cannot just assume that your best bet is to take any offered policy. We absolutely need to examine your specific situation to ensure that you look at all of your options and get the best deal.
Lower Prices In Just A Few Months!
We do know, that these current High Risk Pool clients will get better pricing than what they are paying now, and that is awesome! If you are currently on the High Risk Pool, or have pre-existing conditions that have prevented you from obtaining coverage, please visit our Contact Us page, call us at 713-422-2935 or email us at [email protected] . We are happy to help you navigate the search process and find the best coverage at affordable prices. This is an exciting time for many Texans that have paid huge premiums for a very long time.
Jason W Bohmann
Texas Health Design