WASHINGTON (AP) — Citing financial concerns, the Obama administration has started shutting down the Pre-existing Condition Insurance Plan (PCIP) program.
The administration "has been committed to monitoring PCIP enrollment and spending closely and making necessary adjustments in the program to ensure responsible management of the $5 billion provided by Congress," PCIP director Richard Popper wrote in a memo. "To this end, we are implementing a nationwide suspension of enrollment."
In a teleconference with state counterparts, administration officials said Friday that the PCIP will immediately stop taking new PCIP applications in the 23 states where the federal government administers the program.
States run the PCIP programs in the other states. In those states, consumers may have more time to apply for coverage.
In Wisconsin, for example, residents have until March 2 to apply.
"We're glad this program was here and able to help," said Amie Goldman, who oversees the program in Wisconsin. "I'm certainly disappointed we won't be able to serve everyone who has a need for this coverage."
People already in the PCIP program can keep their coverage, and PCIP enrollees who move to new states can still apply for replacement PCIP coverage, officials said.
PCIP has served more than 135,000 people, including many patients with serious medical problems such as cancer and heart failure.
Overall PCIP enrollment has been lower than expected, partly because some people could not afford the premiums. But individual cases have turned out to be costlier than originally projected.
The PCIP program had spent about $2.4 billion of its $5 billion in total federal funding on medical claims and about $180 million on administrative costs as of Dec. 31, 2012, federal officials told state officials.
Drafters of the Patient Protection and Affordable Care Act of 2010 (PPACA) included the PCIP program in PPACA to provide a temporary solution. When PPACA takes full effect Jan. 1, 2014, it is supposed to prohibit health insurers from considering health status when deciding whether to issue coverage. PPACA also will put tight limits on insurers' ability to use health status information in pricing coverage.
The PCIP program is open to people who have had problems getting private insurance because of a medical condition and have been uninsured for at least 6 months. Premiums are supposed to be comparable to the rates that typical healthy people in a state pay.
For middle-aged individuals, the premiums may be several hundred dollars per month.
PPACA calls for the government to provide new health insurance purchase subsidies in 2014. The new subsidies should cut premium costs for many of the people who now have PCIP coverage, officials say.
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