The Ugly Truth About Pre-Existing Conditions & Health Insurance

Are you overweight? Have you ever had an abnormal mammogram or a cancerous mole or skin lesion removed? Are you taking antidepressants — or have you done so within the past five years? If you answered yes to any of these questions, you may be in danger of being unable to purchase individual health insurance… as these are just some of the criteria insurance companies may use to reject or limit applicants seeking coverage. Being in less than perfect health can make it very hard to get health insurance… and if you can get it, be prepared to pay a bundle for it.

It is in the financial interest of insurers to make every effort to deny, delay or curtail health coverage to anyone they believe will cost them extra money… and that generally means people with pre-existing conditions such as heart disease, diabetes, cancer, etc. People with serious conditions such as these often cannot obtain individual insurance or afford the higher premiums they would be charged. Survey results from The Commonwealth Fund show that 21% of working-age adults who looked into individual market health insurance were turned down, charged a higher price for a pre-existing condition or had their pre-existing condition excluded from coverage. It’s a bad situation and our bad economy is making it worse, as more people unexpectedly find themselves without a job and the healthcare coverage they may have taken for granted. It’s hoped that healthcare reform will address these problems, but in the meantime, you still have certain rights as a consumer, and the more you know about these rights, the more effectively you can exercise them.

WHO SHOULD WORRY?

In 1997, the federal HIPAA or Health Insurance Portability and Accountability Act defined a pre-existing condition as one for which “medical advice, diagnosis, care or treatment was recommended or received during the six months prior to your enrollment date in the plan.” These six months are referred to as the “look back” period. If you get a new job and your employer offers a group health insurance policy, HIPAA limits the amount of time the policy can refuse to cover these pre-existing health conditions. But, if you lose your group coverage, consider yourself vulnerable, since protective rules apply to group health plans, not the individual market.

People who must purchase their own insurance have far fewer rights, cautions Jennifer Libster, MA, JD, a senior research associate at Georgetown University’s Health Policy Institute in Washington, DC. Some 8.5 million Americans are now covered by individual policies, regulated differently by each state. These state laws can be rigid and unyielding in regard to pre-existing conditions. For example, Libster notes that some states permit an elimination rider that permanently excludes a pre-existing condition. Other states allow insurance companies to “look back” at as many as five years of your medical history or more. Some don’t have a limit.

Patient advocate and columnist Trisha Torrey (EveryPatientsAdvocate.com) adds that scrutiny of your health does not end here. An unknown number of people are denied individual health policies based not just on reporting of past illnesses but because prescription histories screen out applicants or charge them higher premiums or exclude pre-existing conditions. Two companies — MedPoint and IntelliScript — sell commercial databases detailing as far back as five years with your history of prescriptions, dosages and refills.

IS CHANGE COMING?

A bit of good news in these trying times is that if you leave your job or are laid off or terminated, the Consolidated Omnibus Budget Reconciliation Act of 1985 — more familiarly known as COBRA — protects your right to maintain group insurance coverage for a limited time (usually up to 18 months, sometimes longer), which continues to cover pre-existing conditions as well as new conditions that arise during this period. COBRA, however, is notoriously expensive. New governmental assistance has recently been made available to reduce COBRA premiums by 65% for eligible people. But once you exhaust COBRA, you’re on your own.

WHAT CAN YOU DO?

If you need an individual policy and are denied coverage for a pre-existing condition or are turned down flat, many states have their own back-up insurance plans, called high-risk health insurance pools. For information on whether your state offers such coverage and what its waiting period is for pre-existing conditions, go to www.statehealthfacts.org. Unfortunately, while these programs are well-intentioned safety nets, many people just can’t afford them. Lynn R. Gruber, chair of the National Association of State Comprehensive Health Insurance Plans, stated in a report in January, “It is important to understand that high risk insurance pools are intended to make coverage available ” not to address the issue of affordability.

To see how your state rates on access to health insurance and coverage of pre-existing conditions, visit the Web site of Families USA (www.familiesusa.org). To learn more about your health insurance options in general, go to the Agency for Healthcare Research and Quality Web site at www.ahrq.gov.

Unfortunately, when it comes to getting health coverage for a pre-existing condition, at present there seems to be a Catch-22 to many options. If change is coming, as has been promised by the new administration, it needs to be big change — and it can’t come soon enough.