Risk Pools
When it comes in health insurance, there are two large groups: the insured and the uninsured. The insured can be further divided into three sub-categories:
- Those insured by the government.
- Those insured by through employers.
- Those insured privately on their own.
The second major group, the uninsured, can be further divided into two sub-groups: (1) those who cannot afford or qualify for any insurance and (2) those who can afford insurance but to whom health insurance companies will not sell any plans because of pre-existing medical conditions.
Risk pools serve the second sub-category of the uninsured. Risk pools are essentially health insurance plans. Usually, states are the entities that form them, and the first state to form a risk pool was Minnesota in 1976. Risk pools provide health insurance to those with pre-existing medical conditions, but the premiums people pay for that insurance are unsurprisingly higher than what they would pay to a private company.
Legally, premiums are limited to twice what private companies would charge, but are on average 1.5 times what an individual pay to private company. Despite the higher prices, however, risk pools still need to be subsidized by the government, as they are prone to losses because of their nature. In general, risk pools cover the same medical services that private plans cover.
Risk pools provide lifetime benefits ranging from $350,000 to $2 million. Today, there are 34 states that have risk pools serving around 183,000 people.
Learn more about Texas Health Insurance Plans
Risk pools are only meant for a certain, limited population. To find out what
Texas health insurance policies and plans are the best for you,
contact Option 1 Health Insurance.