High Risk Health Insurance

High risk pools are state plans that provide health insurance coverage for those who are unable to purchase medical insurance. Coverage is provided through a pool, which is paid for by fees assessed to the insurance companies that do business in the state. The high-risk pool is then run by a non-profit organization.

The pool offers the insurance coverage to those residents of the state who;

1. have been rejected for health insurance coverage by at least one insurance company; and/or

2. have higher premium payments for a currently insured plan than that required by the pool; and/or

3. have insurance under a rated health insurance policy or have a restrictive rider attached to that policy.

The typical lifetime maximum benefits in most states is $500,000 with a $500 deductible. The waiting period in most states is usually six months if the applicant has been treated for a medical problem within the last six months of the application. Generally, in most states the premium paid by the insured ranges from 125% to 150% of the standard premium rate for that of an individual health insurance policy purchased through a standard carrier.

High-risk pools are private, self-funded health insurance plans organized by the state to serve high-risk individuals who meet enrollment criteria and do not have access to group insurance. In most states, they are independent entities governed by their own boards and administrators, but in some states they function as part of the state's department of insurance.

You can apply for high-risk pool coverage through an insurance agent or directly with the state. You generally have a choice of health plan options and will receive enrollment cards and other information just like any other health plan. High-risk pools normally contract with a health insurance carrier or third-party administrator to administer paperwork and claims, so your enrollment card and other paperwork may not even appear to be produced by the high-risk pool. Once enrolled, you use your benefits just like any other consumer of private insurance coverage.

Risk pool health insurance is more expensive than traditional individual insurance. This is fair because pool members, by definition, are those who are considered to be medically uninsurable. State laws generally cap risk pool premiums between 125-150 percent of the base individual market rate.

Example: If the average standard individual premium in a state for a 30-year old male is $100/month, a medically uninsurable male of the same age would pay $125-$150/month for comprehensive coverage in a risk pool.

Risk pool premiums are determined by your age and sometimes by where you live in the state. Pool premiums are fairly affordable nationwide because they are directly tied to the rates in each state's existing individual market.