During Tuesday night’s vice presidential debate, Sen. JD Vance of Ohio, the Republican nominee, vowed to protect health insurance coverage for people with pre-existing conditions while also doubling down on a proposal to place them in a so-called high–risk pool, separating them out from healthier individuals.
To many policy experts watching the debate, the two statements seemed irreconcilable — and harked back to a time before the Affordable Care Act, which guaranteed coverage for people with pre-existing conditions, became law.
“We tried that in the past and it failed,” said Arthur Caplan, the head of medical ethics at NYU Langone Medical Center in New York City. “Anything that separates out pre-existing conditions is doomed to utter failure.”
Before the passage of the ACA in 2010, most states relied on high-risk pools to provide coverage for individuals with chronic illnesses, said Cynthia Cox, vice president and the director of the ACA program at KFF, a nonprofit group that researches health policy issues. High-risk pools were also used for people who fell into a “gray zone” category, where they didn’t have cancer or diabetes “but their kid had three ear infections in the last year and insurance could charge them a higher premium,” Cox said.
The nation’s sickest patients, like those with cancer or chronic illnesses, only represent about 5% of the population but account for more than half of all health care spending, Cox said. Due to the exorbitant cost, insurers often deemed chronically ill people “uninsurable” and would deny them coverage, she said.
“You had such a high cost condition, you just couldn’t get insurance anywhere,” Cox said.
The idea behind a high-risk pool was to provide a safety net for people with pre-existing conditions struggling to find coverage. The pools, which grouped chronically ill people together, encouraged insurers to offer coverage by eliminating some of the financial risk, often through a combination of state funding, mandates and federal grants. This also helped keep monthly premiums lower for sick patients.
The high-risk pools, however, were critically underfunded, making monthly premiums for some patients double what they would be for a healthy individual, Cox said. Due to the lack of funding, insurers would also refuse to cover care for patients.
“If you got into a high-risk pool, you might have had an exclusion on your coverage for six to 12 months,” Cox said. “So, if you had just been diagnosed with cancer, for example, you might not be able to get any chemo for six months or a year after you get into the high-risk pool.”
The ACA attempted to address this problem by eliminating high-risk pools in favor of a single-risk pool model where younger, healthier people would help offset the cost of older individuals who typically have more chronic conditions.
“The underlying idea is kind of a social contract,” said John A. Graves, a professor of health policy and medicine at Vanderbilt University School of Medicine in Nashville, Tennessee. “When you’re healthy and young, you’re paying those same monthly premiums, but when you become sick or have higher costs one day, that market is going to continue to support you.”
The Democratic vice presidential nominee, Minnesota Gov. Tim Walz, had a similar view at the debate.
“I think the idea of making sure the risk pool is broad enough to cover everyone, that’s the only way insurance works,” Walz said. “When it doesn’t, it collapses.”
Graves said that the U.S. could move back to a high-risk pool model but it would require “a massive amount of government subsidies to work.”
“They would basically have to infuse the high-risk pool with enough subsidies to keep premiums affordable for people,” he said. “If they don’t, then functionally speaking, you’re raising premiums on sick people.”
To Cox, the benefits of moving back to a high-risk model were unclear, especially if the federal government had to provide more money to fund the program.
Caplan said that, even then, it wouldn’t work.
“You have to share the risk broadly, in a large group, to make it affordable,” Caplan said. “We had isolated pre-existing pools for the past 25 years, and they don’t work.”
