When you have pre-existing medical conditions, getting health insurance can be a challenge. As of September 2013, health insurers in the private market are allowed to pick and choose customers on the basis of their health. If you have a pre-existing condition, the insurer can set certain terms, charge you more for your premium or deny you coverage. However, there are some options available.
Now What's Wrong?
The definition of preexisting condition varies from insurer to insurer. However, they usually include a major health condition like cancer, diabetes or a history of heart disease or strokes. Other preexisting conditions include high blood pressure, mental health problems and asthma. Depending on which study you look at, these conditions could impact anywhere from 20 percent to 66 percent of American adults, according to the General Accounting Office.
An Insurer's View
An insurer makes money in a relatively simple way -- by collecting more in premiums than it pays out in claims. When a healthy person applies for an insurance policy, the insurer knows it might have to pay for routine checkups, and that there's always the risk that the person might face an expensive medical condition. But the insurer still assumes that the policy on a healthy person is going to be profitable. If you have a preexisting condition, however, the insurer assumes that it will be paying to give you more medical care than it would for someone without a preexisting condition. For example, the GAO found that average annual treatment expenditures for cancer came to around $9,000. These kinds of conditions make you more expensive to cover and lead to a higher premium or to a denial.
Coverage with Preexisting Conditions
If you have a preexisting condition, you aren't completely precluded from buying insurance. If you can get coverage through a job, many group policies don't have preexisting condition limitations. After you lose or leave a job, you can extend your coverage under the rules of the Consolidated Omnibus Budget Reconciliation Act of 1985 with a "COBRA" plan. When buying your own policy, you might be able to purchase one that either covers everything but your preexisting coverage, or that covers your condition after a waiting period. You might also be able to participate in a high-risk insurance pool in your state. While these types of policies tend to be more expensive, they might be the only way you can get covered.
The Affordable Care Act
The Patient Protection and Affordable Care Act of 2010, sometimes referred to as Obamacare, has a gradual phase-in process than spans multiple years. One of its features is a ban on preexisting condition limitations. As of January 1, 2014, insurers can't consider any health conditions as a part of deciding whether to grant coverage or what rate to charge. This allows people with preexisting conditions to buy insurance on the same terms as anyone else.
- GAO.gov: Private Health Insurance - Estimates of Individuals with Pre-Existing Conditions Range from 36 Million to 122 Million
- Tampa Bay Times PolitiFact: Schakowsky Says Half of All Adults Have Pre-Existing Medical Condition
- WebMD: Getting Insurance When You Have a Health Problem
- HealthCare.gov: What If I Have a Pre-Existing Health Condition?
- Slate: The Wisdom of the Ailing
Steve Lander has been a writer since 1996, with experience in the fields of financial services, real estate and technology. His work has appeared in trade publications such as the "Minnesota Real Estate Journal" and "Minnesota Multi-Housing Association Advocate." Lander holds a Bachelor of Arts in political science from Columbia University.