Your Rights to Coverage of Preexisting Conditions
SUMMARY OF YOUR RIGHTS
- If you are joining a group health plan, You have the right to not be denied coverage on the basis of your health status, medical condition or history, genetic information, disability or insurability.
- You have the right to receive coverage for preexisting conditions in most cases within 12 months (or, in some instances, 6 months) of enrolling in a health care plan.
- If you are enrolling in an individual plan, you have the right not to be denied coverage if you have had 18 months of continuous coverage previously and meet certain other requirements.
- You have the right to be credited for time enrolled in a previous plan against any preexisting condition waiting period.
In 1996, Congress passed a law known as the Health Insurance Portability and Accountability Act or HIPAA (also known as the Kassebaum-Kennedy Act), which went into effect on July 1, 1997. HIPAA was designed to allow employees to move freely from one job to another without the risk of becoming uninsured for their most serious health problems. HIPAA also has protections for individuals who move from group plans to an individual health plan. In California, there are additional protections for members of group health plans that go beyond the requirements of HIPAA.
Under HIPAA and California laws, a "preexisting condition," is more narrowly defined as a condition for which medical advice, diagnosis, care, or treatment, including use of prescription drugs, was recommended or received during the six months immediately preceding the enrollment date in a new plan or effective date of coverage."1
WHAT IS A "PREEXISTING CONDITION"?
A preexisting condition generally refers to any health condition that you have had prior to enrolling in your current health plan.
CAN MY HEALTH PLAN DENY COVERAGE FOR TREATMENT OF MY PREEXISTING CONDITION?
Group Health Plans
Yes, but only for those conditions you had in the previous six months and only for a specific period of time allowed by law.
Both HIPAA and California law prohibit group health plans (health insurance usually sponsored by an employer, union or professional association that covers two or more employees) from discriminating against you or your dependents by establishing rules for eligibility based on your health status.
Health care plans are also prohibited from denying enrollment because of a family history of breast cancer or one or more diagnostic tests for the disease when there has been no development or diagnosis of the disease.3
When you are otherwise eligible for health care services under an employee benefit plan, you cannot be completely excluded from the plan (except in the case you enrolled after the enrollment deadline) on the basis of any of the following:
medical condition including both physical and mental illnesses
disability or evidence of insurability, including conditions arising out of acts of domestic violence.2
Under federal law, the period for which a group plan with two or more enrollees can deny you coverage for your preexisting condition is up to twelve months. (Or eighteen months for late enrollees.)4
Under the more protective California law, a small employer-sponsored (2-50 employees) group health plan and any health care service plan contract that covers three or more enrollees (whether employer-sponsored or not) can only deny coverage for a preexisting condition for up to six months following the effective date of your coverage under the plan.5 The twelve-month exclusion period may be applied, however, if you enrolled after the enrollment deadline, or if your plan covers only one or two individuals and is not an employer-sponsored plan.6
How long can a group health plan exclude coverage for a preexisting condition?
Both federal and California law limit the amount of time that a group health plan can exclude coverage for your preexisting condition.
If you are under a federally-regulated health plan, twelve months is the longest period of time that your plan can exclude coverage for your preexisting condition. (Ask your employer if you are not sure whether your plan is subject to the federal law.) For most other group health plans, the more protective California law applies and your pre-existing condition can only be excluded for up to six months. (See margin on this page for more detailed explanation of the federal and state standards.)
If your health plan contract does not contain a preexisting condition exclusion provision, it can require an "affiliation" or waiting period of not more than 60 days before any coverage becomes effective. Although the plan does not have to provide you coverage for any health care services during the waiting period, you also cannot be charged a premium during this time.7
Exceptions to Preexisting Condition Exclusions
A health care service plan issuing group coverage may not exclude coverage for a preexisting condition for any of the following:
A newborn who has applied for coverage through an employer-sponsored plan within 30 days of birth;
A child who is adopted or placed for adoption prior to age 18 who, within the 30 days beginning with the date of adoption or placement for adoption, is covered by another plan.
A condition relating to benefits for pregnancy or maternity care.8
Credit for Previous Health Care Coverage
The length of any preexisting condition exclusion period will be shortened by giving you credit for time that you were previously covered under certain prior health care plans. Specifically, if you are eligible to begin coverage under a new employee group health plan within 62 days of having been terminated from prior coverage under another individual or group health plan, Medicare, Medicaid, or other publicly-sponsored medical care program, then your new health plan must credit any time that you were previously covered towards the preexisting exclusion period.9
Example 1: Patient Mrs. Smith is treated for a medical condition 7 months before the enrollment date in Employer ABC's group health plan. As part of such treatment, Mrs. Smith's doctor recommends that a follow-up examination be given 2 months later. Despite this recommendation, Mrs. Smith does not receive a follow-up examination and no other medical advice, diagnosis, care, or treatment for that condition is recommended to or received by Mrs. Smith during the 6-month period ending on Mrs. Smith's enrollment date in Employer ABC's plan. In this example, Employer ABC's plan may not impose a preexisting condition exclusion period with respect to the condition for which Mrs. Smith received treatment 7 months prior to the enrollment date.
Example 2: Mrs. Smith works for Employer XYZ and has creditable coverage under Employer XYZ's plan for 18 months before Mrs. Smith's employment terminates. Mrs. Smith is hired by Employer ABC and enrolls in Employer ABC's group health plan 64 days after the last date of coverage under Employer XYZ's plan. Employer ABC has a 6-month preexisting condition exclusion period. In this Example, because Mrs. Smith had a break in coverage of 63 days, Employer ABC may disregard Mrs. Smith's prior coverage and subject her to a 6-month preexisting condition exclusion.
Example 3: Same facts as Example 2, except that Mrs. Smith is hired by Employer ABC and enrolls in Employer ABC's plan on the 63rd day after the last date of coverage under Employer XYZ's plan. In this example, because Mrs. Smith did not have a significant break in coverage (more than 62 days), Employer ABC must count Mrs. Smith's prior creditable coverage towards reducing the plan's preexisting condition exclusion period as it applies to Mrs. Smith. Because Mrs. Smith had 18 months of creditable coverage through her plan with Employer XYZ, this would completely eliminate the 6-month preexisting exclusion period under Employer ABC's plan, which would have to provide coverage for Mrs. Smith's condition upon enrollment.
Special Standards for Individual Health Plans
In general, when you are buying an individual health plan (insurance sold outside the employer group market), you cannot be denied health coverage nor be subject to an exclusion period for a preexisting condition if you meet all the following conditions:
You must have had a total of 18 months of continuous "creditable coverage" which means health insurance coverage without a break of 63 or more consecutive days under any of the following: a group health plan; an individual health plan; Medicare; Medicaid; CHAMPUS (health coverage for military personnel, retirees and dependents); Federal Employees Health Benefits Program (FEHBP); Indian Health Service; Peace Corps; or a state health insurance high risk pool. The most recent period of prior coverage must have been under a group health plan, governmental plan, or church plan;
You must have used up any COBRA or state continuation coverage available to you;
You must not be eligible for Medicare, Medicaid, a state program, or a group health plan;
You must not have other health insurance; and
You must apply for individual health insurance within 63 days of losing your prior creditable coverage. 10
If you do not meet these conditions, however, you may be eligible for a state-sponsored program specifically designed to meet the needs of individuals who are denied coverage due to preexisting conditions. California's program is known as the Major Risk Medical Insurance Program (MRMIP) as described further below.
WHAT CAN I DO IF I AM DENIED COVERAGE?
File grievances with your health plan and the Department of Managed Health Care
If you feel that your health plan wrongly denied coverage for treatment of your preexisting condition, you may want to file a grievance with your plan and/or the Department of Managed Health Care (888) HMO-2219 or (877) 688-9891 (TDD).
You may also have the right to obtain a review of your plan's decision through an independent review process. The standards and timelines that apply to these grievance and review processes are further explained in sections VI and VII of this guide.
Sue your health plan
While a health plan may deny you coverage as part of its overall restrictions on certain benefits as they are applied to all enrollees, it may not deny coverage of your preexisting condition in violation of the governing federal and state statutes.
Obtain alternative coverage
If you are unable to obtain coverage on the open market due to a serious health condition, you may be eligible for coverage under the California Major Risk Medical Insurance Program (MRMIP). Health care is provided to qualifying Californians through contracts with various health plans. Participants in the program are responsible for the cost of program premiums, and the program supplements those premiums to cover the cost of care from the state's tobacco tax funds.
To be eligible to participate in the program, you must:
- Be a California resident;
- Not be eligible for both Part A and Part B of Medicare, unless eligible
solely because of end-stage renal disease.
- Not be eligible to purchase any health insurance continuation of benefits
under COBRA or CalCOBRA.
- Not be able to secure adequate coverage as evidenced by one of the following:
- A letter from a health insurance carrier, health plan, or HMO denying individual coverage within the last 12 months;
- A letter from a health insurance carrier, health plan, HMO, or employer indicating involuntary termination of health care coverage for reasons other than nonpayment of premium or fraud;
- A letter indicating that an offer of individual plan coverage by a health insurance carrier, health plan, or HMO is in excess of the Major Risk Medical insurance Program premium for the individual's first-choice of participating program; or the premium for the individual and/or their dependents is in excess of the MRMIP rate for the individual and/or their dependents;
- A letter indicating that a member of a group of one has been denied coverage by a health insurance carrier, health plan, or HMO within the last 12 months.
There are other specific eligibility requirements if you know you are not currently eligible but will be in the future. You can apply for deferred enrollment. Additional information and application materials can be obtained by writing to the Managed Risk Medical Insurance Board at 1000 G Street, Suite 450, Sacramento, CA 95814, by calling (916) 324-4695, or by visiting their Web Site at http://www.mrmib.ca.gov.
WHERE ELSE CAN I GO FOR HELP?
For questions or complaints about a group health plan, call the California Department of Managed Health Care at (800) 400-0815.
For questions about HIPAA and individual coverage, call the U.S. Department of Health and Human Services, Health Care Financing Administration (HCFA) at (415) 744-3600. Answers to commonly asked questions about HIPAA can be found on the HCFA website at http://www.hcfa.gov
- 26 United States Code Annotated (U.S.C.A.) section 9801(a)(1) and Cal. Health and Safety Code section 1357.51.
- 26 U.S.C.A. section 9802; Cal. Health and Safety Code section 1357.52.
- Cal. Health and Safety Code section 1367.6(b).
- 26 U.S.C.A. section 9801(a).
- Health and Safety Code sections 1357.06 and 1357.51(a).
- Health and Safety Code section 1357.51(f) and 1357.50(b) (late enrollees); Health and Safety Code section 1357.51(b) (plans with only one or two enrollees).
- 26 U.S.C.A. section 9801(c)(2)(C); Cal. Health and Safety Code sections 1357.06 and 1357.51.
- 26 U.S.C.A. section 9801(d); Cal. Health and Safety Code section 1357.51.
- 26 U.S.C.A. section 9801(c)(1)-(3) and 29 C.F.R. section 2590.701-4; Cal. Health and Safety Code sections 1357.06 and 1357.51.
- 42 U.S.C.A. section 300gg-41; Cal. Health and Safety Code section 1366.35(a) and (b).