Republican GOP presidential hopeful Scott Walker's proposal for helping people with pre-existing health conditions acquire and maintain affordable health insurance would leave out many who live paycheck to paycheck while dealing with a chronic health problem, some experts say.
This week, Walker, Wisconsin's second-term governor, joined the short list of 2016 Republican presidential candidates who have outlined proposals for replacing the Affordable Care Act, which all 17 candidates have promised to repeal.
Walker's plan is light on details and numbers. But it does include ideas for replacing the ACA, including refundable premium tax credits based on age and turning Medicaid into a state block grant program.
It also offers an approach for dealing with the estimated 50 million to 129 million people who, according to HHS, have an existing medical condition. Such conditions would make it difficult for them to obtain private health insurance if insurers were once again allowed to turn people away or charge them much higher premiums based on medical underwriting.
The ACA deals with the issue by requiring insurers to accept all comers during open enrollment regardless of health status, allowing plans to vary premiums based only on age—with premiums for older people limited to three times the rate for younger people.
Walker's plan would require insurers to accept people with pre-existing conditions only if they have maintained continuous coverage. For those who have not kept continuous coverage, states would be allowed to establish high-risk pools, with federal funding.
Republican presidential nominee Mitt Romney proposed a similar model in 2012, as did GOP presidential nominee John McCain in 2008. It has also been included in a Republican-sponsored healthcare reform bill called the Patient CARE Act, which was offered to replace the ACA.
A document explaining that provision of the Patient Care Act said “this new consumer protection actually helps reward good behaviors and encourages consumers to keep their health coverage.… This approach will help reduce the turnover of consumers coming in and out of the individual market, thus making this market more stable, predictable and ultimately affordable for consumers.”
David Hogberg, a senior fellow at the conservative National Center for Public Policy Research, said the continuous coverage provision encourages people to not let coverage lapse and also encourages young, healthy people to get a policy before they get sick. “It incentivizes good behavior,” he said.
But Topher Spiro, vice president for health policy at the Center for American Progress, which generally supports the ACA, said Walker's approach for addressing the issue of pre-existing conditions is one reason his plan would not achieve high-quality, affordable coverage for all Americans. If the ACA were repealed and replaced by Walker's plan, Americans who struggled to get coverage before the ACA because of a pre-existing condition would have their exchange plan coverage taken away and would have no guarantee of affordable coverage unless they immediately obtained new insurance.
“Imagine all the people who have coverage for the first time” as a result of the ACA, Spiro said. “How would (they) feel?”
Jon Peacock, research director for the Wisconsin Council on Children and Families, said Walker's approach would be disastrous for people who lose their job or have low incomes and slip in and out of coverage because they have a hard time paying the premium. Their only alternative, he said, would be Walker's proposed state high-risk pools. Such pools existed before the ACA was implemented, and they generally had high premiums, capped enrollments, and long waiting lists.
“We've certainly seen in Wisconsin and elsewhere that that coverage is extremely expensive,” Peacock said.
A September 2012 report by the Commonwealth Fund used data from the ACA's Pre-Existing Condition Insurance Plan, a bridge program for people with pre-existing conditions, to show that high-risk pools would likely not be a successful way to insure large groups of people. High-risk pools generally cover people with the most serious and costly health problems, such as cancer and heart disease.
“Given the general lack of affordability of high-risk pool coverage at the individual level and the high costs of plan operation, the potential of high-risk pools as a vehicle for coverage expansion remains quite limited,” the study concluded.
Another Commonwealth Fund report from the same year found that between 2004 and 2007, about 89 million people had a gap in coverage of at least one month. More than a quarter of those people lost insurance more than once in that period. That suggests a large number of people would not receive protection from insurers' medical underwriting and would be excluded from commercial plans.
Conservative health policy experts who support the Walker-type risk-pool approach have acknowledged that high-risk pools need to be better financed by public dollars than those that were in place before the ACA, and that they must be allowed to charge higher premiums than those charged to healthy people.
But a 2011 study in the Journal of General Internal Medicine by Harold Pollack, a social service administration professor at University of Chicago, concluded that at least 4 million Americans would qualify for high-risk pools, and that the cost would be in the tens of billions of dollars a year. That's far more than either Republicans or Democrats have ever proposed to fund such pools.
