Price breaks kick in for 'pre-existing condition' insurance

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http://www.msnbc.msn.com/id/43661356/ns/health-health_care/

Uninsured sick people got some good news recently — or some of them did, anyway. Starting Friday, the Obama administration reduced the premiums by up to 40 percent in special high-risk insurance plans that the federal government is running in 17 states and the District of Columbia.

These "pre-existing condition insurance plans" were created under the 2010 health care overhaul to provide guaranteed coverage to people who have medical conditions that often make them uninsurable in the individual insurance market.

On the low end, Mississippi will reduce premiums by 2 percent. Several states will cut monthly rates in the 15 to 25 percent range, including the District of Columbia, which will reduce premiums by 18 percent. Six states, including Virginia, will reduce their premiums by 40 percent.

Consumers in the 27 states that opted to use the money provided in the health law to run their own PCIPs may not see similar reductions in rates. (Maryland is one of the states that runs its own plan.) HHS has informed those states that they may modify their rates, but they're not required to do so.

There's no word yet on whether other states may follow the federal government's lead and reduce premiums or relax their application rules (many already accept physician letters as proof of illness). But even though the current changes only apply to 18 states, "this is a very positive step forward," says Finan. "I'm not sure we'll see a huge difference, but we expect to see a difference."