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The U.S. Department of Health and Human Services (HHS) announced today the launch of a Pre-existing Condition Insurance Plan (PCIP) that will offer coverage to uninsured Americans who have been unable to obtain health coverage because of a pre-existing health condition.
The Pre-Existing Condition Insurance Plan, which will be administered either by a state or by the Department of Health and Human Services, will provide a new health coverage option for Americans who have been uninsured for at least six months, have been unable to get health coverage because of a health condition, and are a U.S. citizen or are residing in the United States legally.
Created under the Affordable Care Act, the new plan is a transitional program until 2014, when insurers will be banned from discriminating against adults with pre-existing conditions, and individuals and small businesses will have access to private insurance choices through new competitive Exchanges. In 2014, members of Congress will also purchase their insurance through Exchanges.
“For too long, Americans with pre-existing conditions have been locked out of our health insurance market,” said Secretary Kathleen Sebelius. “Today, the Pre-Existing Condition Insurance Plan gives them a new option – the same insurance coverage as a healthy individual if they’ve been uninsured for at least six months because of a medical condition. This program will provide people the help they need as the nation transitions to a more competitive and fair market place in 2014.”
The Affordable Care Act provides $5 billion in federal funding to support PCIPs in every state.
HHS provided states with the option of running the Pre-Existing Condition Insurance Plan themselves or having HHS run the plan. Twenty-one states have elected to have HHS administer the plans, while 29 states and the District of Columbia have chosen to run their own programs.
Starting today, the national PCIP will be open to applicants in the 21 states where HHS is operating the program.
All states which are operating their own PCIP will begin enrollment by the end of the summer, with many beginning enrollment today.
The PCIP will cover a range of health benefits, including primary and specialty care, hospital care, and prescription drugs. The plan does not base eligibility on income and does not charge a higher premium because of a medical condition. Participants will pay a premium that is not more than the standard individual health insurance premium in their state for insurance that covers major medical and prescription drug expenses with some cost-sharing.
Like the popular CHIP, the PCIP provides states flexibility in how they run their program as long as basic requirements are met, according to HHS. Federal law establishes general eligibility, but state programs can vary on cost, benefits, and determination of pre-existing condition. Funding for states is based on the same allocation formula as CHIP, and it will be reallocated if unspent by the states. Unlike CHIP, there is no state matching requirement and the federal government will cover the entire cost of the PCIP. While it took more than 6 months for a small number of states to establish their CHIP programs, Sebelius anticipates that every state will begin enrolling individuals in the Pre-Existing Condition Plan by the end of August.
Information on how to apply for the PCIP is available at www.HealthCare.gov. Americans who live in a state where the U.S. Department of Health and Human Services is running the PCIP will be linked directly to the federal application page. Those living in states running their own programs will also find information on how and where to apply on www.HealthCare.gov.
An informational pamphlet on the Pre-Existing Condition Insurance Plan can be found at: http://www.healthcare.gov/center/brochures/pcip.pdf.
States by Pre-Existing Insurance Plan Administration
29 states plus the District of Columbia have chosen to operate their own plans.
21 states elected to have HHS run their plan.
Source: HHS