Insurance and pre-existing conditions

Factual Questions
1

I don’t know all that much about health insurance (since I never had any, thankyouverymuch employers), so I need someone to clarify something for me about pre-existing conditions. The way I understand it, insurance won’t cover costs related to a disease acquired before you became insured by that particular company. Fair enough, right? Insurance companies would probably lose a lot of money if everyone with AIDS and cancer showed up to buy some insurance the day after their test results came back.

I have a different scenario I’m wondering about, though. Suppose someone had a chronic condition (e.g. diabetes), the treatment of which was covered by his employer-provided insurance. Now suppose this person loses his job. He gets a job at another company. Does the insurance provided by the second company have to pay for treatment related to his condition, or do they get off the hook since it’s pre-existing?

2

The SOP for this situation in my experience is that most employers make you take a physical before you are officially hired. The doctor sends a report back to your personnel department saying, “Well, Patient X is fine except for A, B, and C”
The employer can then say, “OK, we can live with that” or “Nope, we’ll pass.”

There are some limits to this of course which have been established by law and I think others know better.

My employers have never been bothered by any pre-existing medical condition I’ve had.

Another way around this is for someone to marry (or get domestic partner benefits from) an otherwise healthy person.

3

Nuetron star, once you get a job with insurance your caring and smart government makes this insurance company carry you (for a fee) until you get another job. This business of being carried over gets you a little certificate saying you’ve been insured all along and goes to the new company when you get your next job (one, two or more months later). So the new company must also take you on pre-existing condition or not.

This little program might be called COBRA or I may have just made that name up.

Even if you have a pre-existing condintion you can be insured at the time of your first job for everything except that particular disease and if you go for some designated period of time with out treatment for the pre-existing condition the company will take over that condition as well.

Are you driving with your eyes open or are you using The Force? - A. Foley

4

I am an insulin-dependent diabetic. Have been for 15 years. I have changed jobs several times over the past 5 years. Not only have I not been denied because of the pre-existing condition, I have not even been required to take a physical. Of course, I’m talking about HMO’s and PDO’s here, but I’ve been with Blue cross, Blue Sheild, Aetna, and Pacificare. They won’t deny you for diabetes, but cancer may be another story.

5

I forgot to mention that all said insurers paid for doctors office visits, insulin, eye exams, syringes and test equipment. Some at no charge to me.

6

COBRA (Consolidated Omnibus Budget Reconciliation Act ) is correct, Jois, and the other acronym you need is HIPAA (Health Insurance Portability and Accountability Act of 1996). Here are some helpful links, neutron star.
www.insure.com/health/hipaa.html www.insurancebenefit.com/hippainfo.htm

7

COBRA coverage lasts for 18 months I believe. If I’m not mistaken, it only requires the insurance company to provide you the same coverage you had through your employer. For example, if your employer pays 80% of the premium, and you pay 20% (all with pre-tax dollars), you are required to pay 100% of the premium under COBRA (not sure whether it is still pre-tax–somehow I doubt it).

As for the OP, group policies, as from most large employers (and many mid-sized or small employers in groups), generally have no qualifications regarding pre-existing conditions. The idea being, I suppose, that the handful of individuals with said conditions are more than covered by the vast majority of employees with no conditions. This is why there’s a story every now and again in the Washington Post about a federal employee with a very sick family member who changes health plans every two or three years–the lifetime limit (only $2 million in my HMO, doesn’t seem like that much if you’re very ill) has been exceeded, and they switch to another plan offered by the feds. But there’s no tests and no problem with pre-existing conditions because it’s a group policy with an awful lot of participants. I’d WAG that most large employers’ plans are similar.

8

HIPAA’s a great idea – we’ve been hiring like crazy over the past couple of years, and people are overjoyed to learn that we’ll cover their diabetes, pregnancy, cancer, etc. without any waiting period. The only other “rule” is that the employee has to actually sign up within 30 days after they become eligible. With us, that’s a 65 calendar days probation.

If they don’t complete the enrollment within 30 days, then they aren’t allowed to sign up until our next “open enrollment”, which is January 1, and then they are subject to a 12-month exclusion for pre-existing conditions.

Someone mentioned physical exams – on a related (?) subject, and not to hijack, our lawyers say we can’t subject someone to a physical unless we’ve first offered them a job. And under the ADA, we can’t turn someone down if they have a physical disability, as long as it doesn’t prevent them from doing the work.

We have a short list of physical actions that we ask if they can do (bending, lifting, twisting, etc.) and if they say they can do it, we have to hire them.

By the time someone has disclosed a physical history (back surgeries, heart problems, etc.), it’s too late – they’ve been hired, and we have to accommodate them.

If someone discloses physical problems in the interview (we aren’t allowed to ask, but sometimes they volunteer), then we have to have **another]/b] reason for not hiring them.

Needless to say, our work comp costs have skyrocketed, along with Sickness & Accident payments, medical costs, and hiring extra workers so that we have enough people to cover for the ones who can’t work.

I guess the ADA is a good thing, but there is a downside for employers.

9

I just recently left a job at an HMO and I’ve been waiting for weeks for someone to ask a question about HMOs. I believe we handled pre-existing conditions in line with the industry standard.

Each employer group, when it initially signs up, is subjected to health underwriting. The health histories of those employes (not a typo, Wisconsin by law drops an e) to be covered are screened. The decision is made to cover the employe group as a whole or not to cover the group as a whole based on the underwriting review, and rates are set at that time based on health underwriting, group size and benefit levels desired by the group.

The group has the choice of including a pre-existing (PX) clause in its contract. If they do so, no current employes selecting coverage are subject to the PX but employes later wishing to elect coverage (either new employes or existing employes who opted out of coverage initially) are. The PX lasts for twelve months from the effective date of coverage. If the employe had previous comparable health insurance, the PX time will be reduced for one day for each day of previous coverage. For example, previous coverage of 100 days will reduce the PX from 365 days to 265 days.

There is no specific list of conditions which would be subject to the PX; it would be in general any condition for which the employe had sought treatment during the time reviewed in health underwriting or any condition which was obviously pre-existing. For example, I dealt with someone who had arthroscopic surgery the day she became effective on the policy and we denied it as PX. She hadn’t sought treatment for the condition previously, but obviously one does not usually suddenly have the need for arthroscopic surgery. We denied the claim under the PX.

Types of previous insurance which would reduce PX time include another HMO, a fee-for-service plan and Medicaid. COBRA is an extension of a previous HMO or FFS plan so that counts too. COBRA can last for different numbers of months depending on the reason one goes on COBRA. Loss of employment qualifies the person for up to 18 months. Loss of coverage because of death of the policy holder or divorce qualifies the dependent for up to 36 months. If there is more than one qualifying event (i.e. policy holder loses job, then a divorce) the COBRA qualification period may be extended, but in no case can it be longer than 36 months. There are other qualifying events for COBRA as well.

10

This is a true story.

We switched insurance companies when our child was a toddler (11 years ago.) I had to fill out an “Evidence of Insurability” form, on which I stated that she had been treated for ear infections in the past year, and that she was in fact being treated for one at that time. A few weeks later she had to have tubes. The insurance company told the surgery center that they’d have to look into whether her situation was pre-existing before they’d agree to pay. I told the SC that it was pre-existing, and made arrangements to pay for it myself. After it was all over, though, I was looking through my papers and I found one from the ins. co. that said this: “Any condition disclosed by you on your Evidence of Insurability form, and not specifically excluded in the policy, is covered, even though it is pre-existing.” I called up the insurance company and politely pointed this out, and told them I had looked all over that policy and found no mention of the ear infections. So - they paid. Probably they just never really looked at that E of I form.

11

The insurance industry has always tried to avoid pre-existing conditions in the same way it avoids what is called “anti-selection.”

Simple example of anti-selection: I have never bought life insurance. I find out that I have terminal cancer, so I buy a zillion dollar life insurance policy, pay premiums for about six months, then I die and my beneficiary is fantastically wealthy. Insurance premiums are not set up to handle such costs; insurance is (ultimately) a group of policy-holders paying a fixed amount so that the claimants can be paid as agreed, and it is unfair to all other policy-holders to have someone deliberately take advantage of the system. Thus, insurers are constantly on guard against anti-selection.

The same is obviously true of health insurance. I go for all my life without health insurance UNTIL I find out I have a cancer that involves very expensive treatment, and then I buy the health insurance. To screen against this, the insurers exclude pre-existing conditions.

Such exclusions were, of course, damaging to people who changed jobs (and thus insurers or HMOs or whatever), and so COBRA and related were enacted in the last few years as protection. After all, it’s not like someone hasn’t had health insurance before, it’s just that it hasn’t been with THIS particular carrier.