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PCIP Problems Possible Sign Of Things To Come, Economist Warns

04/04/13

  10:49:53 am, by MedBen5   , 216 words,  
Categories: News, Health Plan Management

PCIP Problems Possible Sign Of Things To Come, Economist Warns

Financial headaches brought on by the federal government’s pre-existing condition program could prove a harbinger of even higher costs under health care reform, a health economist warned lawmakers yesterday.

According to MedPage Today, the Pre-Existing Condition Insurance Plan (PCIP), which the Affordable Care Act created as a way to provide health coverage to those with pre-existing medical conditions before other aspects of the law take effect in 2014, does nothing to reduce the costs of care for those patients, Thomas Miller, JD, resident fellow at the conservative American Enterprise Institute, said at a congressional hearing.

In February, the Obama administration announced that it would no longer accept new enrollees into the PCIP program, due to its $5 billion in funding being nearly exhausted. The program enrolled only 110,000 members, far less than the 375,000 expected.

Prior to the February announcement, the Centers for Medicare and Medicaid Services reduced payments to providers treating a high number of high-risk pool enrollees and cut the number of pharmacies providing certain types of drugs. The agency also increased the maximum out-of-pocket costs by $2,250.

“If the forthcoming health exchanges are plagued by premium spikes, implementation misfires, limited enrollment, and adverse selection, they may end up more closely resembling somewhat larger versions of PCIPs than more competitive alternatives in the current private insurance market,” Miller said.

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