Obtaining health insurance can be a tricky process. Now add the fact that you have one or more pre-existing conditions. The process is even more challenging. If you are currently employed and insured under a group health insurance program, you cannot be denied coverage because of a pre-existing condition. Unfortunately, for many people, group insurance is not an option. For those who are self-employed or are simply to sick to work, an individual health insurance plan is the only choice. For these people, is it possible to get individual health insurance with a pre-existing condition?
Pre-Existing Condition Insurance Plan (PCIP)
In the past, many health insurance companies that did consider applicants with pre-existing conditions required them to undergo a waiting period before these conditions were covered. In some cases, this period was as long as 18 months. While there were some protections built into the law for those with preexisting conditions, they were extremely limited.
In March of 2010, the Obama Administration passed the Affordable Care Act (ACA), which created a new federally administered program providing individual health insurance for those with preexisting conditions. The Pre-Existing Condition Insurance Plan (PCIP) is currently administered in 23 states and the District of Columbia through the U.S. Department of Health and Human Services. The remaining 27 states administer the program themselves. State-based programs vary and you must check with your state for information on how to apply and other general information. Thanks to recent legislation, as of July 1 premiums for pre-existing insurance plans in some states will be reduced by as much as 40%.
There are three requirements that must be met in order to be eligible for coverage under PCIP. First, the plan requires that you are a citizen of the United States or reside in the U.S legally. Second, you must have been without health coverage for at least six months and have a pre-existing condition and third, you must have been recently denied coverage due to health.
There are three different options available under the PCIP- the standard plan, the extended plan and the HSA plan. Each plan has different premiums, deductibles and prescription co-pays. For example, the HSA offers the individual the chance to open a tax exempt health savings account for depositing money used for medical care. With all plans, after a deductible is met, you pay 20% of remaining medical costs. Maximums are set at $5,950 for in network and $7,000 for out of network. This is the maximum amount that you will have to pay out of pocket for treatment. In addition, there is no lifetime maximum or cap on the amount the plan will pay for your medical treatment. Health benefits include primary and specialty care, hospital care and prescription drugs.
In 2014, the reform law will be fully implemented, making it illegal for private insurers to deny coverage due to health history. In the meantime, the PCIP provides an opportunity for people with pre-existing conditions to find some peace of mind in knowing that they are covered.