Democratic Lawmakers Call On GAO To Study Individual Health Insurance Market, Including Effectiveness Of State High-Risk Pools

Main Category: Health Insurance / Medical Insurance
Article Date: 07 Mar 2008 - 12:00 PDT

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Reps. John Dingell (D-Mich.), Henry Waxman (D-Calif.) and Frank Pallone (D-N.J.) have asked the Government Accountability Office to examine state insurance pools' effectiveness in covering high-risk individuals, CQ HealthBeat reports. Thirty-four states offer some form of a high-risk pool, according to the National Association of State Comprehensive Health Insurance Plans. Such insurance pools are intended for individuals who are unable to obtain coverage through private insurers and usually offer coverage at a higher cost than private plans.

The lawmakers in a letter to GAO requested that the agency examine the pools' effectiveness in providing a safety net for individuals who cannot obtain or cannot afford private insurance; how premiums are determined based on the standard rate in the individual market; and how the benefits compare to those offered by large state employers. In addition, the lawmakers wrote that the formula for distributing grant funds to states under the Trade Assistance Act is "very general and vague." The law provides training, wage and health insurance subsidies to workers who have lost their jobs because of foreign competition.

The request is part of a call for a broader GAO investigation of the individual health insurance market. In the letter, the lawmakers wrote, "The individual market for health insurance coverage is seriously flawed," adding, "Many people who need insurance and apply for it are denied coverage in the individual market or are offered insurance coverage that turns out to be inadequate or it is too expensive or both" (Johnson, CQ HealthBeat, 3/5).

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