Can Insurance Companies Decline You for Preexisting Conditions?

An insurer issues a health insurance policy to cover all or a portion of the costs related to a person's care in exchange for a premium. Before entering into a contract, an insurer examines a prospect's medical history and often requires the applicant to submit to a physical exam. Due to recent and upcoming changes in federal law, the government limits an insurer's ability to deny health insurance to a person because of the existence of a preexisting condition discovered in the individual's medical records or preliminary exam.

Preexisting Condition

• While each state maintains its own definition of a preexisting condition, the term generally refers to a physical or mental ailment that requires a person to seek medical advice, treatment, diagnosis or care within six months of a policy's enrollment or effective date. Depending on the nature of an individual's preexisting condition and the terms of the contract, an insurer may deny coverage altogether or exclude expenses resulting from the treatment of the person's preexisting condition for a period of time.

Affordable Care Act and Children

• In March 2010, the president of the United States signed the Affordable Care Act into law. Among other tenets, the Affordable Care Act includes a provision regarding children under 19 and preexisting conditions. Effective September 23, 2010, the law does not allow an insurer to refuse health insurance to a child with a preexisting condition or to exclude healthcare services required to treat the condition.

Affordable Care Act in 2014

• As of January 1, 2014, the Affordable Care Act provides to adults the same protections currently extended to children suffering from preexisting conditions. In other words, as of January 1, 2014, the law prevents insurers from denying, canceling or restricting coverage to any legal resident or citizen of the United States due to the presence of a preexisting condition. The law also precludes insurers from charging a person with a preexisting condition a higher premium than it would charge someone else for similar coverage.

Preexisting Condition Insurance Plan

• The Affordable Care Act makes temporary health insurance available to people with preexisting conditions through a preexisting condition insurance plan (PCIP) developed by the U.S. Department of Health and Human Services (HHS). This plan is available through the beginning of 2014. Funded exclusively by the federal government and administered in each state by either the state's government or the HHS, the PCIP program provides health insurance to citizens or legal residents of the United States who suffer from medical conditions that have prevented them from obtaining coverage in the past and who have not had health insurance in the past six months. The Affordable Care Act authorizes the replacement of the PCIP program with health insurance exchanges in 2014.