You care about coverage for pre existing conditions because either you or someone you know has a pre existing condition.
According to an April 2019 Kaiser Family Fund (KFF) poll, a majority of Americans say they are worried that they or someone in their family will lose coverage or not be able to afford coverage if either the entire ACA or the part that protects people with pre existing conditions is overturned.
Health conditions ranging from obesity to multiple sclerosis could leave you uninsurable in the private health insurance market if the ACA’s pre-existing conditions coverage requirement is repealed, an effort that is currently underway in the U.S. Court of Appeals (Texas v. Azar).
68% of Americans that participated in the KFF poll indicated that they do not want the Supreme Court to overturn pre existing conditions coverage (2019).
We’ll cover some important information about pre existing conditions coverage in this blog post, including:
- What counts as a pre existing condition
- What it was like before the ACA if you had a pre existing health condition: medical underwriting and state high risk pools
- How the ACA protects individuals with pre existing conditions today
- Texas v. Azar and the effort underway to repeal pre existing conditions coverage
- What health insurance you can get if you have a pre existing condition
Want to find out what health insurance to get if you have a pre existing condition?
Go to that section now.
Who is impacted by pre existing health conditions in the U.S.
First off, it’s important to recognize how many people could be adversely impacted if their major medical insurance was no longer required to cover pre existing conditions:
Over a quarter of American adults impacted – 27% of adults under age 65 are estimated to have a health condition that would likely leave them uninsurable if they applied for coverage under pre-ACA medical underwriting practices (2016).
Women are adversely impacted at higher rates than men – A larger share of nonelderly women (30%) than men (24%) have declinable pre existing conditions. That translates into 29.4 million women and 22.8 million men, with pregnancy explaining part but not all of the difference.
Some states are more negatively impacted than others – Colorado and Minnesota have the lowest rates of non-elderly population with declinable pre existing conditions at 22%. West Virginia has the highest rate of declinable population at 36%. (The U.S. average is 27%.)
Many people were denied coverage before the ACA. It was worse in some states – Application denial rates ranged from 0% in a few states that didn’t allow medical underwriting prior to the ACA, up to 33% in Kentucky, North Carolina and Ohio.
People without employer health insurance were often denied coverage – Prior to the ACA, it’s estimated that 18% of individual health insurance market applications were denied. Many people with health conditions never applied in the first place since they knew they’d be declined, so the percentage may be even higher.
What is a pre existing condition + do you have one?
We’ll talk more about what the pre existing condition repeal could mean for you a little later in this blog post. But first, consider whether or not you would be able to obtain an individual major medical insurance policy without the pre existing conditions coverage guarantee provided by the ACA.
- Alcohol abuse or drug abuse with recent treatment
- Arthritis, fibromyalgia, other inflammatory joint disease
- Cerebral palsy
- Congestive heart failure
- Coronary artery/heart disease, bypass surgery
- Crohn’s disease/ulcerative colitis
- Chronic obstructive pulmonary disease (COPD)/emphysema
- Hepatitis C
- Kidney disease, renal failure
- Mental disorders (bipolar, eating disorder)
- Multiple sclerosis
- Muscular dystrophy
- Severe obesity
- Organ transplant
- Parkinson’s Disease
- Pending surgery or hospitalization
- Pneumocystic Pneumonia
- Pregnancy or expectant parent
- Sleep apnea
And even if you weren’t automatically declined, due to medical underwriting, you could be charged more or had your coverage or benefits reduced for things like being overweight, having elevated cholesterol or blood pressure, or even a history of visits to a chiropractor.
Medical underwriting + obtaining individual health insurance before the ACA
Medical underwriting is a process used by insurance companies to understand your health status when you apply for health insurance in order to determine whether to offer you coverage, at what price and with what exclusions or limitations.
Depending on the results of the underwriting, you could be subject to a few different “adverse” underwriting actions, including:
- Being denied coverage
- Charged a higher premium
- Subject to a temporary or permanent exclusion rider in which coverage for a specific condition, body part or system may be excluded
- Charged a higher deductible
- Subject to modified benefits – with certain benefits excluded or limited (e.g., no prescription drug coverage).
In addition to pre existing health conditions, you could be found ineligible for coverage based on medications you’re currently taking or even your occupation. Examples of declinable occupations include:
- Active military
- Air traffic controller
- Iron workers
- Law enforcement/detectives
- Meat packers/processors
- Offshore drillers/workers
- Security guards
- Steel workers
- Taxi drivers
- Window washers
Before the ACA, if you were declined coverage, you could be sent to a state run high-risk pool, but that didn’t necessarily mean you’d have access to affordable health insurance either.
In fact, in states with high-risk pools in 2010 less than 1% of the uninsured population was enrolled in them. That same year, a poll found that 60% of people who shopped for health insurance in the individual market found it difficult or impossible to find a plan they could afford.
State High-Risk Pools
High-risk pools operated in 35 states prior to the ACA and became part of the conversation in 2017 as they were part of the American Health Care Act (AHCA), the ACA “replacement” plan that passed the House of Representatives in 2017 and was defeated in the Senate.
The AHCA proposed state run high-risk pools as an alternative for states that wished to opt out of the ACA’s pre existing conditions requirement.
However, contemporaneous data suggests that these high-risk pools weren’t particularly effective at expanding insurance access or reducing cost for the people that needed them:
By concentrating all the sick people in one pool, their out-of-pocket costs (deductibles and coinsurance) were very high. 14 states had plans with annual deductibles of $10,000 or more. (Comparatively, the highest deductible ACA plans available now are Catastrophic plans with an annual $7,900 deductible for 2019.)
30 states imposed maximum lifetime benefits limits, some had annual coverage caps as low as $75,000. (Lifetime and annual limits went away under the ACA).
Premiums could be quite high, ranging from 125 to 200% the average premium in the individual health insurance market.
Sometimes states had to impose waiting lists because there wasn’t enough money to cover enrollees. There were even waiting periods imposed for coverage for the very conditions that caused people to have to use the high risk pool in the first place.
Texas v. Azar could mean the end of the ACA, pre existing conditions coverage
The ACA’s pre existing conditions coverage requirement means that since 2014, health insurance companies can no longer charge you more or deny coverage in an ACA-qualifying major medical plan because of a pre existing condition such as asthma, diabetes or cancer. In addition, they cannot limit your benefits or refuse to cover treatment for your pre existing condition.
But the pre existing conditions coverage requirement, or the entire ACA, could be at risk of being repealed due to a lawsuit, Texas v. Azar, currently making its way through the courts.
Please note, the materials available at this website are for informational purposes only and not for the purpose of providing legal or tax advice. You should contact your attorney or tax professional to obtain advice with respect to any particular issue or problem.
Texas v. Azar
In February 2018, Texas and 19 other Republican state attorneys general brought forth a lawsuit arguing that the individual mandate tax penalty repeal, which Trump signed into law on Dec. 22, 2017, should invalidate the entire ACA and with it, pre existing conditions protections.
Their argument is that the ACA relies on the individual mandate, and that without the individual mandate tax, the individual mandate is unenforceable and as a result the rest of the ACA should also be struck down.
In May 2018, 17 Democratic state attorneys general, led by California, were allowed to intervene in the lawsuit in order to defend the ACA in its entirety.
In June 2018, the U.S. Department of Justice (DOJ) stated that it would not defend the law in this case. It actually went further than simply declining to defend the law and agreed with plaintiff states, urging the court to strike down the ACA’s guaranteed issue provision, pre existing condition exclusion, and community rating provisions.
According to several news outlets, including Kaiser Health News (KHN), it is considered highly unusual for an administration to not defend a federal law in court.
The states defending the ACA in the lawsuit include: California, Connecticut, D.C., Delaware, Hawaii, Illinois, Kentucky, Massachusetts, New Jersey, New York, North Carolina, Oregon, Rhode Island, Vermont, Virginia, Washington, Minnesota.
What would repeal mean for you?
Pre existing conditions repeal is not popular. 68% of Americans polled do not want the Supreme Court to overturn pre-existing conditions coverage (2019).
54% of Americans indicate that it is “very important” to them that the ACA provisions protecting people with pre-existing conditions remain law even after hearing that this rule may have led to higher insurance costs for healthy people (2019).
If Texas wins the case, the entire ACA could be invalidated or just parts of the ACA, like guaranteed pre existing conditions coverage, could be repealed.
And that could have a big impact on a lot of people. An estimated 52 million people with pre-existing conditions risk either losing coverage, paying higher premiums or finding themselves locked in their current health insurance plan (such as an employer’s group plan), according to Reuters.
State-level protections for key ACA provisions
The impact of pre existing conditions coverage repeal would be felt differently depending on the state in which you reside.
Prior to the ACA, pre existing conditions protections were determined at the state level, with most states providing very limited protections. With the threat of federal repeal, some states are examining whether or not additional legislation is needed.
There are three protections relating to pre existing conditions under consideration at the state level, that:
- Major medical policies continue to be guaranteed issue
- Major medical policies cannot exclude pre existing conditions from coverage
- Community rating be preserved, meaning health insurers cannot vary premiums within a geographic area based on age, gender, health status or other factors.
As of August 2018:
- 4 states (Colorado, Massachusetts, New York and Virginia) have adopted all three ACA provisions or developed equivalent protections.
- 14 states have partially adopted the ACA’s pre existing condition protections meaning residents of those states could still face cost or accessibility challenges if federal pre existing conditions coverage is repealed.
- 9 states and D.C. adopted one or more of the provisions but void them if the corresponding ACA provisions are repealed or invalidated.
- 29 states have no state-level ACA consumer protections (and many of these states are also plaintiffs in the Texas v. Azar case).
Learn more about which states have adopted which provisions at the Commonwealth Fund.
What health insurance should you get if you have a pre existing condition now?
Currently under the ACA, health insurance companies cannot refuse you ACA-qualifying major medical insurance or charge you more based on a health problem you had before the date your new coverage starts. That makes ACA-qualifying major medical plans “guaranteed issue”.
Because of the comprehensive coverage, which includes coverage for the 10 essential health benefits and pre existing conditions, major medical insurance policies tend to come with higher premiums than non-ACA policies.
Other health insurance options if you do not have a pre existing condition
Other types of insurance that are not governed by the ACA and do not follow the ACA’s rules still use medical underwriting. Those types of health plans include:
- Short term health insurance
- Accident + critical illness insurance
- Hospital indemnity insurance
- Gap medical insurance
That means you can still be denied coverage, charged more, have your benefits reduced or exceptions added to your coverage based on your health status if you enroll in one of these non-ACA policies.
Because these plans are limited to healthier individuals and provide less coverage (e.g., preventive care is typically not included) the premiums also tend to be lower than major medical plans.
So, if you can’t afford a major medical premium or missed the annual open enrollment period, you can still get some level of coverage if plans are available in your area and you qualify.
Find out if you can get a non-ACA short term health insurance policy.
Summary + Next Steps
A large number of Americans are impacted by pre existing conditions, either theirs or a family member’s. The ACA’s pre existing conditions coverage requirement has resulted in millions more Americans being able to access major medical insurance, particularly in the private health insurance market.
The current threat to pre existing conditions coverage is in the form of the Texas v. Azar lawsuit, which is an attempt by a number of states to repeal either the pre existing conditions mandate or the entire ACA.
If you have a pre existing condition and need coverage, ACA-qualifying major medical health insurance is still your best option, even though premiums can be high. Many enrollees qualify for federal subsidies so check your eligibility.
Check your subsidy eligibility.
You may be able to qualify for non-ACA health insurance with lower premiums and less coverage, meaning you’ll pay for routine healthcare out of pocket and only use your insurance policy for critical illnesses or accidents that result in hospitalization or emergency care.
Because you can apply year-round, temporary health plans can help if you missed the annual open enrollment period for individual health insurance or if you’re between employer plans.
Compare policy options and costs (it just takes a minute).
If you’re not sure which type of insurance is right for you or have questions, call (888) 855-6837 to speak with a licensed agent.