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Ask a healthcare blogger: Am I stuck with my current plan forever if I have a pre-existing condition?


When we talk about pre-existing conditions we tend to focus on problems with buying insurance on the individual market, where:

  • insurance companies can refuse to cover you;
  • insurers can charge you much more than healthy people; and
  • if you get sick, insurers can find ways to drop your coverage.

But it’s an issue that affects even those who are lucky enough to have decent coverage through an employer or government program. Knowing that they couldn’t afford or would be outright rejected for other coverage, many people with pre-existing medical conditions feel trapped in their current plans.

Health reform changed all that. Most of the bill doesn’t take effect for another two years, but there are a few parts that provide some immediate relief to people with health problems. To answer your question, we’ll look at new options for people with pre-existing conditions both right now and in 2014, once the law is fully in place.  

RIGHT NOW

A couple big things have already taken effect:

1. Insurance companies can’t deny coverage to children with pre-existing conditions

Background: The law says health plans “may not impose any pre-existing condition exclusion with respect to such plan or coverage” for children under 19. Believe it or not, insurance companies actually considered fighting this one. For a while, they argued that the wording meant that, while they couldn’t write policies to exclude a child’s pre-existing condition, they could still deny coverage altogether. When the White House made it clear that they disagreed with this interpretation, insurers backed down (turns out they weren’t looking forward to a lengthy public lawsuit defending their “right” to deny sick kids coverage).

Bottom Line: Insurers have to sell plans to kids under 19 with pre-existing conditions, and these plans cannot exclude those medical conditions. The downside, though, is until 2014 they can continue charging more for these kids.

2. High-risk pools

Background: As a stopgap measure to help provide coverage before 2014, the Affordable Care Act created new state-run, federally subsidized high risk pools– aka Pre-existing Condition Insurance Plans (PCIP’s). Unfortunately, the new law only set aside $5 billion to fund these plans, an amount that experts warned wasn’t enough to cover the estimated 375,000 Americans with pre-existing conditions who could be eligible.

However, as of October 1, only 41,427 people had enrolled in the new PCIP’s. There are a few possible reasons for the low turnout:

  1. Congress set extremely strict eligibility rules. You can only sign up for the new high risk pools if you’ve been uninsured for 6 months– and going without insurance simply isn’t an option for many people with costly medical conditions. Even if your current insurance doesn’t cover your pre-existing medical condition, you’re still not eligible to enroll in the new PCIP’s.
  2. Many people may not know about these plans or realize they qualify. The plans were set up quickly— within 90 days of passage of the laws– but often there wasn’t an accompanying PR or marketing campaign to let people know about this new benefit.
  3. Adding to possible confusion– thirty-five states already had high risk pools, which together cover over 200,000 people. The new federally funded plans are better– with premiums 10-50% lower than current state rates– but again, in order to be eligible, you’d have to drop out of the state plan and go without insurance for 6 months. Many people are unwilling or unable to take that risk.

Bottom line: There is a new, reasonably priced coverage option for people with pre-existing conditions, but you have to have been without insurance for 6 months in order to qualify.

In 23 states and DC, the federal government runs these pre-existing insurance plans. Other states opted to run the PCIP’s themselves, which means that the premiums and deductibles for these plans vary from state to state. To find out more about the PCIP’s and apply, check out pcip.gov. They have a map where you can click on your state for all the info you’ll need.

Another site anyone can use to find affordable insurance options (even if you don’t have a pre-existing medical condition) is http://finder.healthcare.gov/ — also created by the Affordable Care Act.

[UPDATE: PCIP’s attracted such high risk patients with such costly medical needs that, despite low enrollment, some states are running short on cash.] 

IN 2014

Clearly things are complicated now, but in 2014 it’s simple: people with pre-existing conditions will be treated the same as everyone else.

Insurers won’t be able to deny coverage to people for any reason, including health status. On top of that, they won’t be allowed to charge people more based on health status or gender. Plans can charge higher premiums based on age, but there’s a limit– at most, older people can be charged three times more than young people.

Also, all new health plans have to provide comprehensive coverage that:

  • includes at least a minimum set of services,
  • caps annual out-of-pocket spending,
  • does not impose cost-sharing for preventive services,
  • does not impose annual or lifetime limits on coverage, and
  • limits waiting periods on coverage to 90 days.

All of this means that after January 1, 2014 you won’t be stuck in your current plan if you have a pre-existing condition. If you leave your job (or decide to take a job without insurance) you’ll be able to buy decent coverage on the exchanges, just like everyone else.

BUT…

There are a couple potential obstacles though. One is the Supreme Court, which is scheduled to rule on the constitutionality of health reform sometime this spring. It’s unlikely that their ruling would repeal the whole law– even if they do rule against reform, they’d probably only strike down the insurance mandate, leaving the rest of the law intact. Congress would then have to figure out some other mechanism to keep coverage affordable.

A bigger problem is if Republicans take back the White House and the Senate, since all of the leading Republican candidates have promised to repeal health reform. If you or someone you know has a pre-existing condition, that’s something worth thinking about in the upcoming elections.

Have a question about healthcare you want answered? Leave it in the comments below, tweet it to @whatifpost, or email it to us at whatifpost[at]gmail[dot]com!

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