Obama Administration Drops Program That Helped Uninsured Find Coverage

The Centers for Medicare and Medicaid Services are ending a program that paid out a $100 incentive to agents and brokers to refer patients to the Pre-Existing Condition Insurance Plan, PCIP, which was created by President Obama’s health care reform. The PCIP  helps who can’t find affordable health insurance because of pre-existing health conditions.

The PCIP has been a failure to date only enrolling 56,257 people, far below the 200,000 to 375,000 people who were projected to join and a tiny fraction of the 50 million uninsured. The $5 billion set aside for the program has been spent faster than predicted as the cost of each individual that enrolls costs more than double the government prediction of $29,000 a year .

The Obama administration announced last year that it would start paying insurance agents and brokers $100 whenever they helped eligible people obtain coverage through the program.

Premiums were also lowered and rules relaxed for those eligible, though a person must still have been uninsured for at least six months to get qualify.

The fees helped grow the program, according to the Obama administration. “We know that agents and brokers played a role in boosting the awareness of and increasing enrollment in PCIP during this campaign, and on average, about 10 to 15% of enrolled applications to the federal PCIP involved an agent that qualified for the fee,” CMS said in a written statement. “We have seen increases in awareness and enrollment. More people know about PCIP.”

There are anywhere from 36 to 122 million Americans who have a pre-existing condition that health insurance companies can use as an excuse to refuse coverage, offer plans that covers everything but the pre-existing condition or charge exorbitant rates, according to a new report by the Government Accountability Office.

The health care reform law will prohibit all insurance companies from denying health benefits because of pre-existing conditions beginning in 2014. The PCIP will expire at that time.

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