Goal: Texans should be able to purchase health insurance— regardless of their income or health status.
Problem: The Texas Health Insurance Risk Pool (THIRP) was created to ensure that individuals, who would otherwise be considered uninsurable because of a pre-existing medical condition, have a means to purchase health insurance. Because the cost of the Risk Pool is out of their reach, many middle income Texans are on the verge of losing their health coverage, and many more are prevented from ever enrolling.
Recommendation: The Texas Legislature needs to implement a sliding scale premium discount for lower income and certain middle income families, which would make the Texas Health Insurance Risk Pool affordable.
Background: The Texas Legislature chose to create the Texas Health Insurance Risk Pool in order to comply with the federal Health Insurance Portability and Accountability Act (HIPAA). The other alternative provided by HIPAA is to require insurance carriers to guarantee issuance of health policies to individuals regardless of health status.
The cost of the premium is set in Texas statute at twice the cost of the average premium in the individual market—and that does not take into account deductibles and co-payments. There are 33 states that have health insurance risk pools and only three states set the premium this high.
Justification: Implementation of a sliding scale discount for lower income and certain middle income families would help reduce the number of uninsured Texans, prevent devastating financial consequences for families, and keep people with chronic illness healthier, thus preventing or forestalling more expensive long term care.
The implementation of this discount would provide eligible Texans with cost-effective health coverage.
An affordable risk pool is important for all Texans who face the risk of being uninsured—not just Texans with disabilities. Such a pool could reduce the number of uninsured by providing an important insurance option for Texans with chronic health conditions that do not have employer sponsored coverage. In fact, for most of these individuals, it is the only option for health insurance.