‘High-risk’ pool medical insurance program set to begin

The Obama administration and some state governments will begin accepting applications Thursday for new insurance programs designed to cover people who have been denied insurance because they have preexisting medical conditions.

These so-called high-risk pools were included in the new healthcare law to provide relief for some of the most desperate uninsured Americans until 2014, when insurance companies will be required to cover everyone regardless of medical history.

Also taking effect Thursday will be the first of the new taxes in the healthcare law — on tanning salon services.

Here are some basics about the preexisting condition insurance plan and the new tax:

Who will be eligible for the insurance plan?

American citizens and legal residents who have been without insurance for at least six months and have been denied coverage because they have a preexisting medical condition.

Applicants in most states will need a recent copy of a letter from a private insurance company denying coverage altogether or denying coverage of a specific condition.

In states that have a “guarantee issue” law requiring some or all insurers to cover people regardless of health, an applicant will have to show a premium quote substantially higher than the premium to be charged by the new high-risk pool.

The new law allows the secretary of Health and Human Services to cap enrollment, but administration officials said for now the federal government would accept all eligible applicants.

Which states will have programs and when?

These 21 states have asked the federal government to run the high-risk pool rather than administer it themselves: Alabama, Arizona, Delaware, Florida, Georgia, Hawaii, Idaho, Indiana, Kentucky, Louisiana, Massachusetts, Minnesota, Mississippi, Nebraska, Nevada, North Dakota, South Carolina, Tennessee, Texas, Virginia, Wyoming.

Residents of these states can apply starting Thursday. Administration officials said people who apply by July 15 will begin receiving coverage by Aug. 1.

The remaining 29 states and the District of Columbia will run their own programs and begin accepting applications over the next several months.

Several of the largest states operating their own plans, including California, Illinois and New York, are not expected to begin enrollment until August. The administration expects that all states will begin enrolling people by the end of the summer.

How much will the insurance cost?

Premiums, as well as benefits, are expected to vary greatly from state to state, with some plans charging as little as $140 a month and some as much as $900 a month, according to administration officials. Premiums could vary by age. And some states may offer a variety of benefit packages.

How do I sign up?

The federal government’s new healthcare Web portal at https://www.healthcare.gov, which becomes operational Thursday, will offer instructions. Residents of states where the federal government will run the high-risk pool will be able to find applications there. Administration officials said the website would also contain instructions for residents of states that are running their own pools.

What if my state already has a high-risk pool?

Many states have been operating such pools for years, but some are prohibitively expensive or have been closed to new enrollees. Because the rules for the new plans will be different, administration officials are encouraging people who have been without coverage to consider applying for the new pools.

Will there be enough money to cover to everyone?

Very likely not. The new healthcare law allocated $5 billion for the new high-risk pools, but several independent analyses, including one by the nonpartisan Congressional Budget Office, have estimated that more money would probably be needed because demand will be so high.

The Department of Health and Human Services will be able to shift money from states that are not using all their allotted funds to those that need more, but so far administration officials have been reluctant to talk about seeking more funds.

Who will have to pay the new tanning tax?

The law levies a 10% tax on tanning services, which salons are expected collect from consumers and forward to the federal government.

The law exempts phototherapy services provided by a medical professional for the treatment of dermatological conditions, sleep disorders and other conditions.

noam.levey@latimes.com