This is the second installment of our new feature: Curbside Consult. For the uninitiated, curbside consults are a venerable medical tradition, whereby a doctor seeks informal advice from an experienced colleague in treating a patient with a complex condition. In covering or understanding complex health and social policies, we need sometimes help too.
Today’s interview is with Katherine Swartz, PhD. She is Professor of Health Economics and Policy at the Harvard School of Public Health. Author of Reinsuring Health: Why More Middle-Class People Are Uninsured and What Government Can Do, she has researched state efforts to cover the uninsured and to help people with costly conditions who fare poorly in the private health insurance market.
Swartz is a particular expert in the economics of high-risk pools (HRPs--sorry for the acronym) and reinsurance. If you follow health reform, you’ve probably heard these terms thrown around without a lot of discussion of what these terms actually mean.
To put it simply, HRPs are special insurance plans for people who couldn't get coverage on their own, because of costly pre-existing medical conditions. Reinsurance is probably best explained as "insurance for the insurers." It's a special fund that reimburses insurers for the super-high claims of catastrophic medical expenses. The idea is that this spreads the burden of those expenses as widely as possible, while removing (at least partly) the incentive insurers have to avoid risky beneficiaries.
Both parties propose HRPs and reinsurance to address the immediate and long-term challenges in financing care for people with costly conditions. President Obama mentioned HRPs in his address before Congress to offer quick help to people facing the dual challenges of uninsurance and serious illness. Such provisions are contained in the Baucus bill and in recently-proposed Republican amendments. The Bush administration made modest investments in HRPs. Senator McCain’s 2008 health plan made heavy use of them, as do current Republican proposals presented in the House.
