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What Is A High Risk Pool For Health Insurance?

By Cathy Wilson Posted in Health Insurance News

Most people in the US obtain their health insurance coverage through their work. In fact, 60 percent of Americans are covered under their employer’s policy, and another 27 percent are covered through government funded programs. The rest of the population however, is left to purchase health insurance coverage individually from private insurance companies. This is usually not a problem if you and your family are healthy. However, if you or a member of your immediate family have a pre-existing medical condition it may be impossible to find an insurance company willing to provide you with coverage. Insurance companies prefer to provide insurance to low-risk individuals that are not likely to rack up huge medical expenses in order to make more profit. Those with pre-existing health problems are likely to use their medical insurance and thus are considered high-risk clients.

High Risk Pools Are In Place To Insure The Uninsurable

State governments set up high-risk pools in order to help those individuals who can not acquire health insurance coverage independently from private insurance companies. All of the people who are denied coverage by private insurers are grouped into a pool and are offered the option to buy into state-funded health insurance plans. Although these are state-funded plans, policy holders pay much higher premiums then those who are insured through work or other group plans.

Not All High Risk Pools Are Created Equal

Currently 34 states in the US offer some sort of high-risk  health insurance plans with Minnesota being the first state to enact this type of government sponsored health plan. Not all state-funded high-risk polls are effective though. There are states that have well organized high-risk polls set up that provide good coverage at affordable rates to those who would otherwise not be insured. But, there are many state programs in place that do not provide adequate coverage or are far too expensive. This is usually because of poor organization and lack of funding.

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