SOURCE: Pollitz (2004).
states in support of high-risk pools under the Trade Act of 2002. In 2002, $20 million was appropriated to help states create high-risk pools and $80 million was appropriated over 2 years to offset a portion of losses incurred by states from operating high-risk pools (U.S. DHHS, 2002, 2003a,b,c). These grant programs expired at the end of 2004. In the 109th Congress, legislation has been introduced to reauthorize $15 million in seed grants for fiscal years 2005 and 2006 for states launching high-risk insurance pools and to provide $75 million in grants for fiscal years 2005 through 2009 for states that currently operate high-risk pools (State High Risk, 2004, 2005; Kaiser Family Foundation, 2004c).
Comprehensive state reforms of the individual market that were made in the 1990s increased the availability of coverage for higher risk people, according to a recent assessment of their impact (Williams and Fuchs, 2004). However, while premiums for higher risk people decreased, coverage became less affordable, on average. States with comprehensive reforms experienced a decrease in coverage rates overall because people with lower risks left the market due to the higher price they faced for individual insurance, although coverage increased for people who were older and in poorer health. This problem might be alleviated if tax credits or other assistance to