Anticipate Adverse Selection

The implementation of the 2010 healthcare act set up "high-risk pools” for those without insurance but these will be closed to new applicants as soon as Saturday and no later than March 2 because the "Funds run low for health insurance in state ‘high-risk pools’". This was a temporary measure designed for those who were uninsurable due to pre-existing conditions. Up to 375,000 sick people were expected and would have bankrupted the program. But eligibility was limited to people who have gone without insurance for at least six months resulting in about 135,000 people being covered.

The result is that, while only about 135,000 people have gotten coverage at some point, they are proving far more costly to insure than predicted.

Complicating matters is the fact that many go untreated, exacerbating their medical problems and are in immediate need of expensive care.

“What we’ve learned through the course of this program is that this is really not a sensible way for the health-care system to be run,” Cohen said.

Hat tip: Mungowitz