An unintended consequence of state regulators getting tougher about enforcing health insurance solvency standards is putting Illinois in a squeeze. Three insurers have been forced into liquidation by the state Department of Insurance over the past year, and their members have come knocking on the door of a state program set up 11 years ago to help those deemed commercially uninsurable. Unfortunately, the program has been having enough money troubles of its owncollecting only about 45 percent of the cost of providing careand hasn't been able to accommodate the former customers of the liquidated companies.
After years of holding right around the 5,000 mark, enrollment surged by 10 percent in the first half of 2000. The new demand came partly from those who had been insured in the liquidated companies, but also because solvent companies have tightened underwriting guidelines and are turning down almost anyone who had ever been treated for hypertension or with asthma, explains Janet Kirby, director of underwriting for the program. In addition, those in the program are getting more expensive care. "When they become ill, they become quite ill," Kirby says. In 1999, 182 enrollees had claims of more than $50,000. Last year, the number topping that level was 238.
The program has stopped taking new members, and Gov. George Ryan is seeking a supplemental appropriation. Until it comes through, there's a waiting list, and about 15 percent of those on it were once insured by the out-of-business firms.
Daniel Moskowitz. Illinois trips over its own insurance regs.
Business and Health