August 23, 2010

What is a Pre-Existing Condition?

Posted August 18, 2010

By Jay Angoff, Director of the Office of Consumer Information and Insurance Oversight

This is one in a series of Health Care Notes that we’re posting to help respond to the questions and comments consumers are submitting to

A number of visitors to have told us they’d like to know more about pre-existing conditions.

At a very basic level, a pre-existing condition is a physical or mental health condition, disability or illness that you have before you enrolled in a health plan.

I know what you’re thinking: but couldn’t that be almost anything?

There is no one definition of a pre-existing condition. Health insurance issuers and employer plans use different definitions. Depending upon your condition, you may be denied coverage or charged a higher premium.

Some plans consider acne, asthma or high blood pressure a pre-existing condition. Others narrow the definition of pre-existing conditions to cancer or diabetes. Sometimes you might have totally recovered from a condition – like a past bout with depression – and it will still count against you. While some States limit how far back an insurer can look for a pre-existing condition, some States have no limit.

Private insurance companies may choose to deny your application for health coverage because of a pre-existing condition, or agree to sell you a policy, but exclude coverage for benefits associated with certain pre-existing conditions. Or the insurance company may charge you more because of a pre-existing condition.

What this means is that if you have a pre-existing condition, you may have been unable to obtain coverage or afford coverage.

The good news is that, under the Affordable Care Act, denying coverage or excluding benefits due to a pre-existing condition will no longer be allowed. For children under 19, this new protection applies for plan years beginning this fall. For everyone else, this protection will be in place by 2014. After 2014, insurers also will no longer be able to charge higher premiums based on a pre-existing condition. (Note: the exception to this is grandfathered individual family policies.)

For individuals with a pre-existing condition, the new Pre-Existing Condition Insurance Plan (PCIP) program will help to bridge the gap until 2014. Specifically, the PCIP program will make health coverage available to people with a pre-existing condition who have had no health insurance for at least the last 6 months and who have been unable to obtain insurance from private insurance companies because of a pre-existing condition.

Under the PCIP, such individuals will be able to obtain coverage at the same price as would be paid by individuals of average health in their state. And, under the new PCIP program, that coverage will include immediate coverage of health care services linked to your pre-existing condition.

A PCIP is available in every state—but the exact nature of the plan offered by the PCIP, and how eligibility based on a pre-existing condition is to be demonstrated, may vary depending on your state:

◦ In some states, the U.S. Department of Health and Human Services is operating the program. If this is the case in your state and you have been denied enrollment or coverage of specific benefits due to a health condition, you have a pre-existing condition that makes you eligible.

Some states are running their own programs. Different states may use different methods of determining whether you have a pre-existing condition.

The key takeaway here is that if you are interested in the Pre-Existing Condition Insurance Plan, you should contact the program in your state.

Note: Even if you have a pre-existing condition, the PCIP may not be the best insurance option for you. For example, if you already have insurance you would not be eligible to join the PCIP in your state, or you might be eligible for another program like Medicaid which might be a better fit for you.

In general, make sure you check out the Insurance Finder to find out what options are available for you and your family.


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