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Archive for the ‘Preexisting Conditions’ Category

Making Sure Preexisting Conditions Stay Covered

Posted on: November 1st, 2012 by Kristen Marie

Dear COBRA Insurance Direct,

Although I am currently employed, I am fearful that my company may soon go out of business and I have a pretty serious preexisting health condition that would likely disqualify me from many private plans. Additionally my company doesn’t have their own health plan but instead purchases a plan through a business association and the plan is in the name of the business trade association. If they do go out of business (which looks like will happen) – will I be able to purchase a family policy through the business association? Or will I be able to find a new plan due to the HIPAA act which makes it illegal to exclude people with preexisting conditions as long as too much time doesn’t pass. Should I apply for COBRA instead? It just seems expensive…

Thanks!

– Confused in Minnesota

Dear Confused in Minnesota –

First of all – you are definitely one step ahead of the game since you are already thinking about this. Many people don’t give a second thought to health insurance until it is too late and then scramble to find a solution. Being proactive before your company goes under is a smart move and will likely save you money and help you find the best coverage for you. This is even more important since you have a preexisting condition that could exclude you from certain policies and plans.

Let’s start with the good news. Under the HIPAA – Health Insurance Accountability and Portability Act – you are guaranteed to have access to continued health insurance that includes coverage of your preexisting condition as long as you sign up quickly for a new policy. In most cases you have 63 days to sign up for a new plan before companies can exclude your preexisting condition. Additionally some states mandate that you use COBRA as an option first if it is available. It is best to check with your state health care office for exact regulations in your state.

Now let’s talk about COBRA. In order to be able to use COBRA the company has to remain in business – without a business and a health plan, there is no COBRA insurance. So is the company does go out of business as you expect, COBRA is off the table and you will need to look for a new policy.

In terms of buying an individual health plan from the business association, that will be up to them. They may allow you to purchase a plan since you will remain in that industry, but they also may not. Health insurance is expensive and they may not be willing to take on an additional expense.

Likely your best option will be to find a new plan as soon as you learn the company is indeed closing. Make the start date of that plan the same day as your last day of coverage. Make sure to find a plan that allows you to continue to use the same doctors and networks you prefer for your condition and when you shop around for policies, ask specific questions about your health condition and coverage. The more you ask the better the policy will be that you find.

Thanks –

COBRA Insurance Direct

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