Beginning in 1998, the Texas Legislature created the Texas Health Insurance Pool, a high-risk pool which consisted of a separate insurance pool for the chronically ill who were virtually uninsurable in an unregulated non-group (sometimes referred to as individual) market. (Without pre-existing conditions protections, insurers will charge sick people more than those that are well). The pool was financed by patient revenue and assessments paid by insurance companies and HMOs as well as federal grant funds.


The pool reportedly provided very limited care to the 23,000 Texans covered under it in its final year of operation (2013), who paid premiums twice as high as standard market rates. Texas enrollment in the pool in 2011 consisted of 2.6 percent of the non-group market enrollment. The Texas pool had a one year pre-existing condition exclusion as well. High-risk pools are a key provision of GOP ACA replacement proposals, which typically offer states federal grant funds to establish these pools.