House Committee on Education and Labor
U.S. House of Representatives

Rep. Howard P. “Buck” McKeon
Ranking Member

Fiscally responsible reforms for students, workers and retirees.


Left Turns

May 4, 2010

CONTACT: Alexa Marrero
or Brian Newell
(202) 225-4527

States Stand Up for Fiscal Responsibility: Reject ObamaCare’s Costly & Unsustainable High-Risk Pools

In September of 2009, President Obama promised Congress and the American people his health care reform plan would “immediately offer low-cost coverage” to individuals “who can’t get insurance today because they have preexisting medical conditions…” But at a time when states face $375 billion in combined budget deficits through 2011, the president’s promise is proving too difficult to keep. 

Eighteen states have said they will not administer a stopgap program to provide insurance coverage to people whose preexisting conditions have left them uninsured, forcing the federal government to do the work. The states' decisions increase the challenge the government faces as it sets out to translate the far-reaching health-care legislation into action, and they hint at the complexities to come… Some governors said they were unwilling to take on the task because it appears that Congress has allocated too little money.” (Washington Post, “18 states refuse to run insurance polls for those with preexisting conditions,” 5/4/2010)


“The Commonwealth of Virginia will not establish and serve as a vendor of a temporary high-risk pool. Virginia has estimated that the funding available to the Commonwealth in the amount of $113 million plus or minus 1% will not cover costs of the program beyond 22 months.” (Office of Virginia Governor Robert McDonnell, Letter to Secretary Kathleen Sebelius, 4/30/2010)


“Minnesota takes pride in having one of the nation’s lowest rates of people without health insurance. We also are among the first states to create a high risk pool which now has the largest enrollment in the country. Based on our experience and concerns over the new national high risk health insurance pool, Minnesota will not participate in the new federal program… Minnesota, along with most other states, is managing its budget through challenging times… we cannot afford to expose Minnesota taxpayers to added potential costs and administrative burdens now.” (Office of Minnesota Governor Tim Pawlenty, Letter to Secretary Kathleen Sebelius, 4/30/2010)


“Nevada does not currently operate an insurance high risk pool and we believe the funding provided for this component is grossly inadequate. We estimate Nevada’s share (DHHS estimate of $61 million) of the $5 billion national pool will only allow approximately 2,900 individuals to be served. Nevada’s uninsured population is over 500,000; and, we estimate there may be 100,000 individuals eligible for the high risk pool.” (Office of Nevada Governor Jim Gibbons, Letter to Secretary Kathleen Sebelius, 4/28/2010)


This should come as no surprise to Washington Democrats. In January – two months before the Democrats’ government takeover of health care became law – the chief actuary for Medicare and Medicaid warned the initial $5 billion taxpayer investment would be “exhausted” in two years, resulting in “substantial premium increases” that would “limit further participation.”  

Not only did Washington Democrats ignore this warning, they also ignored the House Republican commonsense solution to strengthen states’ existing high-risk pools through the savings achieved by real medical malpractice reform – ensuring affordable coverage for those with preexisting conditions. 

When Democrats ignore credible warnings and commonsense solutions, promises are broken and the American people pay the price.

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