Health insurance options for those with preexisting condition
Amy Reiley had resigned herself to joining the ranks of the uninsured. The part-time L.A. resident and owner of a boutique cookbook publishing company had a group insurance plan that for three years covered her and another full-time employee.
But when Reiley’s employee became eligible for Medicare, she lost the group policy and was left to search for insurance on her own.
FOR THE RECORD:
Preexisting conditions: In the Sept. 6 Health section, an article on health insurance for people with preexisting medical conditions incorrectly stated that individuals could access annual records on their use of prescription drugs by contacting the MIB Group. The MIB Group does not compile personal pharmacy information. To access that information, consumers can contact Milliman IntelliScript at (877) 211-4816 or at www.rxhistories.com /contact_us.html; or MedPoint Compliance, Ingenix at (888) 206-0335 or www .ingenix.com/contactus/. —
Reiley, in her 30s, has a history of headaches resulting from neck spasms, which she manages with a muscle relaxant. Because of her condition, all her applications for insurance were denied.
“I tried two companies and looked into what the state had to offer and there really wasn’t anything I could do,” she says.
For people with preexisting medical conditions, looking for health insurance in the private market may feel like the ultimate fool’s errand. A 2009 report by the Commonwealth Fund found that 36% of people who tried to buy insurance in the private market were denied coverage or charged more because of a preexisting condition or had the condition excluded from their coverage. Cancer, heart disease, diabetes, rheumatoid arthritis and drug and alcohol dependency are certain to be automatically rejected by insurers — and even people who have minor conditions may find the search for an insurance plan tricky.
When the health reform law takes full effect in 2014, insurers will no longer be able to deny coverage to people with preexisting medical conditions. In the meantime, new federally funded high-risk pools for the medically uninsurable have been established. To qualify, you have to be without insurance for six months. And you must show you have applied for, and been denied, insurance in the private market.
But if you have a preexisting condition and don’t qualify for the high-risk pools, it still pays to explore options in the private insurance market. “Don’t assume if one insurer rejects you that they all will,” says Anthony Wright, executive director of Health Access California, a statewide advocacy group. Reiley, for example, did try again, this time with an experienced insurance broker. Although she paid more because of her condition, she found a plan that is cheaper than what she was paying for as a member of a small group.
With proactive steps as well as insight into how insurers decide who they’ll cover, you can improve your chances. Tips:
Know your rights
If you’ve exhausted your 18 months of COBRA benefits available after leaving a job, federal law guarantees you a policy from private insurers. In some states (including California), insurers are permitted to consider the state of your health when determining the premium, says David Rousseau, health policy expert at the Kaiser Family Foundation, a nonprofit healthcare organization. But you can’t be turned away.
The type of policy available differs among states; in California, carriers must offer their two most popular plans. Check with your state’s department of insurance to learn the rules where you live (www.naic.org/state_web_map.htm).
Bill Robinson, vice president of legislation for the California Assn. of Health Underwriters, urges consumers to make sure they receive and safely file a certificate of “credible coverage” sent by their previous insurer. This is the only document that proves to a new company that you had prior coverage. “Just about all companies may refuse to pay a claim for pre-existing conditions until the individual gets the certificate. Don’t throw it away,” Robinson says.
A number of common medical conditions fall into a “gray area” of medical underwriting (the process wherein insurers review your age, gender and health history to determine how much it will cost to insure you) that won’t necessarily disqualify you from getting coverage, says Amir Mostafaie, consumer health insurance expert at eHealthInsurance. Examples are allergies, asthma, mild depression, well-managed high blood pressure, and controlled migraines and sleep apnea.
A patient with asthma, for example, may find coverage available because treatment is not expensive, Mostafaie says. Not so a patient with kidney stones. “To you it was something that just hit you in the middle of the night, and even though it was tough, after one or two days you may think it’s not a problem and even forget about it,” Mostafaie says. “The way underwriters look at it, though, you may be more prone to [kidney stones] because of your anatomy or you don’t drink enough water. That surgery, coupled with your few-hour stay in the emergency room, will cost about $20,000. And carriers know that.”
Insurers also are more likely to cover someone with a clear-cut diagnosis being managed with inexpensive medications rather than a borderline case that may blow up later.
Take care with the application
As a part of the underwriting process, insurers will review an application that asks a variety of questions about your health. Experts suggest a balanced approach in responding. “Don’t answer a question that isn’t asked,” Robinson says. But don’t be too terse either: If you only answer “Yes” to a question about a health condition, it may look more threatening than it is. “Sometimes a little extra information will help the underwriting process,” Robinson says.
Insurers may follow up with a phone call and more questions. Before getting on the phone, be prepared, says Deborah Chollet, senior fellow at Mathematica Policy Research, an organization that analyzes policy. “Know what [healthcare] services you have used and the issues that have come up,” she says. Have a copy of your medical records in front of you.
There are things you can do to keep your medical records clean, experts say. Stick with successful treatments (underwriters don’t like to see meds repeatedly changed). Lose weight and exercise so your body mass index (BMI) is within the healthy range — it shows a long-term commitment to health. Review your medical records, then ask your doctor to correct any inaccuracies. “It’s important both medically and legally that your record be accurate,” Chollet says.
The hope is that health reform will simplify insurance, but we’re not there yet. “In the current very complicated marketplace, getting some assistance is a big deal and a help,” Wright says. To find a licensed agent knowledgeable about the carriers in your state, check the National Assn. of Health Underwriters’ website, https://www.nahu.org. You can also compare plans side by side online at eHealthinsurance.com or speak with one of eHealthinsurance’s licensed agents at .
Using generic or over-the-counter medications is one way to make a preexisting condition look less threatening and expensive and is something consumers should always discuss with their doctors. And those prescriptions you fill “just in case” but never use? They can come back to haunt you. Insurance companies often check prescription history as a part of the underwriting process.
Insurance carriers will know what drugs are prescribed to you: They subscribe to a service that lets them see an individual’s five-year history of prescriptions filled. From that, a pharmacy risk score is produced; It plays a significant role in the decision-making process.” It doesn’t matter if you took the drugs or not; the money was spent,” Mostafaie explains. But it’s still worth asking your doctor to reflect in your chart that you didn’t take the pills or, if you took something, you later stopped and now feel better.
Under federal law, consumers are entitled to a free annual copy of their prescription file. For instructions on how to request a copy, contact the insurance consumer reporting agency, MIB Group, at https://www.mib.com/html/request_your_record.html.
Los Angeles resident Daniel MacDonald, 37, learned the lesson of medication history the hard way. Working with a friend in L.A. to start a studio recording business, he sought insurance for himself and his daughter. Several years back, he’d been prescribed anti-anxiety medication to cope with the loss of a family member. He no longer takes the medication — but that didn’t matter to underwriters.
“The prescription put a black mark on my history and increased the premium,” he says. After a 20-minute underwriting interview, MacDonald was extended coverage but is paying a higher premium because of his past medication use.