Obamacare PCIP Program closes enrollment

Obamacare PCIP Program Shuts down for new enrolles

The PCIP (Pre-Existing Condition Insurance Plan) one of the firsts program initiated by Obamacare in 2010 is shutting down its doors for new applicants and no longer taking any new applications. On a teleconference meeting last week Obama administration officials confirmed the shut down of the Pre-Existing Condition Insurance Plan. The administration stated various reasons why the program will no longer be taking applications in the 23 states where it is currently administered. Some of these reasons were timing and others were for financial reasons. Individuals currently in the plan will retain their health coverage until they choose to leave the plan. If you go to the PCIP website there is a large pop-up message confirming the shutdown.

What is the PCIP Program?

The Pre-Existing Condition Insurance Program was designated by Obamacare to help those deemed uninsurable get health insurance coverage. The Pre-Existing Condition Insurance Program (PCIP) was implemented to cover individuals that had an existing medical condition, and spent at least six months without insurance coverage. Most of these individuals were individuals that had challenges obtaining private insurance because of their pre-existing medical conditions.

This program was a measurement to help protect, and provide  health insurance prior to the full role out of the various Obamacare provisions, such as the opening of the Health Insurance Exchange. The Health Insurance Exchange specifically bans and prevents Health Insurance companies from denying coverage to anyone with a pre-existing condition, or other medical condition.

Why is the PCIP Program shutting down?

Health Insurance Exchange:

Starting next January 1, 2014 The Health Insurance Exchange allows everyone to purchase private health insurance, and insurance companies cannot turn anyone away, additionally the federal government will also provide various subsidies and tax credits for anyone with financial hardships. Many of the individuals that are part of the PCIP program may find lower premiums and higher savings by purchasing insurance on the Health Insurance Exchange.

Limited Funding

The PCIP program currently has 135,000 beneficiaries in the program. Most insurance companies deemed those individuals uninsurable. This high-risk pool includes those individuals with cancer, heart failures, and other grave medical conditions. When the program started the United States Congress allocated 5 Billion dollars to the program. At the end of 2012 the program had spent 2.4 Billion dollars on medical claim, and 180 Million on administrative services. Additional program enrollees would increase the rate at which the program budget and funding would run out. The Obama administration has already increase the premium on a quarter of the 135,000 beneficiaries.

While this program was one of the first programs established by Obamacare it also seems to be the first program that is quietly winding down.

5/2013 Update: PCIP Program changes payout rules to providers

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