| May 16, 2013

Obamacae's temporary high-risk pool in Oklahoma provides a valuable lesson

Because it doesn’t fit the narrative, Obamacare proponents in Oklahoma, including many in the media, are ignoring an important development related to Obamacare.

Obamacare created optional, temporary high-risk pools (a temporary public option) that could be established in every state, to provide coverage for those who could not obtain health insurance. Proponents touted the program, but detractors warned about its costs and its fundamental flaws. Obamacare proponents heckled these detractors, much as they are now heckling the detractors of Obamacare’s Medicaid expansion.

You probably haven’t heard the news that Oklahoma’s temporary high-risk pool, created by Obamacare, ceased enrolling new participants (an enrollment cap) on March 3, 2013, even though we were promised that it was going to be available to anyone who needed it and who could meet the criteria for participating until 2014. This decision was made by the federal Department of Health and Human Services’ Center for Consumer Information and Insurance Oversight and applied to all Obamacare temporary high risk pools in the nation. Even though it is a federal/state partnership, the temporary high-risk pool is funded and regulated by HHS. What’s ironic and hypocritical is that one of HHS’ reasons for recently denying continuation of the current Insure Oklahoma program is that Insure Oklahoma has an enrollment cap, to make sure that usage of the program can be budgeted for and funded responsibly.

Nationally, Obamacare proponents are trying to ignore the story as well, because it turns out that estimates of the program’s cost and usage were off the mark. Unsurprisingly, the $5 billion made available in Obamacare isn’t enough for the promises. In Oklahoma, for example, in the first two years of the high-risk pool there were just under 900 participants. Medical claims and expenses were $27,179,147, while premiums were just $3,925,963, meaning this Obamacare program in Oklahoma has a total claim-loss ratio of 692 percent!

The federal government’s track record with this very small and restrictive program, and its track record with other entitlements and government-program cost estimates, is extremely poor. Based on this, it would be foolish for a state to trust rosy and understated cost estimates by bureaucratic advocates of a much larger program like Obamacare’s proposed Medicaid expansion or premium-assistance funding proposals. Which is why Oklahoma Governor Mary Fallin has wisely rejected both the Obamacare exchange and the Obamacare Medicaid expansion, and has signaled she is opposed to efforts which try to tap into Obamacare funds for premium-assistance programs.

The high costs of Obamacare’s temporary high-risk pools, and the federal government’s need to resort to reforms that it won’t let Oklahoma implement, provide a valuable lesson: Don’t trust someone you can’t trust. Entitlement programs, especially federally funded entitlement programs, usually cost much more than promised.

Photo: spirit of america /

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