In a letter this week to Health and Human Services Secretary Kathleen Sebelius, state officials said they were “blindsided” and “very disappointed” by a federal proposal they contend would shift the risk for cost overruns to states in the waning days of the program. About 100,000 people are currently covered.
Craziness. Best I can tell, this is an issue for the 27 states that elected to run their own high risk pools with money from the Fed’s instead of having the Federal Government run it. Colorado has it’s own high risk pool with Federal funding.
Perhaps states that are fighting Obamacare and not signing up for the Medicaid expansion are making wise choices…
The crisis is surfacing at a politically awkward time for the Obama administration, which is trying to persuade states to embrace a major expansion of Medicaid under the health care law. One of the main arguments proponents of the expansion are making is that Washington is a reliable financial partner.
So let’s review. The Federal Government initiated high risk pools (Pre-existing condition insurance plans or PCIP) with no waiting periods for pre-existing conditions as part of the initial implementation of Obamacare. The made two mistakes in their projections:
- The number of people that actually enrolled ended up being significantly below expectations.
- Even with reduced enrollment, there was not enough money set aside to provide the coverage they need.
So, that tells us the Fed’s have no idea how to run an insurance program and the insurance companies no doubt will be very cautious in the pricing of their Obamacare cmpatible plans to avoid this same issue.
Amateur hour anyone? Cost overuns anyone? You can’t make this stuff up.