Health Insurance Laws on Covering a Pre-existing Disease

A pre-existing condition refers to a condition you have before applying for or obtaining health insurance coverage. Traditionally, many employers attempted to exclude coverage for pre-existing conditions, or even deny people coverage, entirely on the basis of a pre-existing condition. Under the 1996 Health Insurance Portability Act (HIPAA) amendment to ERISA (the Employee Retirement Income Security Act), there are limitations on an employer when it comes to excluding coverage for pre-existing conditions.

Exclusionary Conditions

• Under HIPAA, only conditions diagnosed in the six months prior to joining the health plan can be excluded. This means if you have had a condition your entire life, you cannot be denied health insurance on the basis of it. However, if you were told to get treatment for an illness and/or you began treatment for an illness or disease six months or less, your employer does not have to cover that pre-existing condition.

Exclusion Limitations

• There are certain exclusions for those pre-existing conditions determined six months or less. For example, pregnancy cannot be excluded as a pre-existing condition. This means if you discovered you were pregnant a month before you were hired, your employer cannot deny you access to health insurance and cannot deny coverage for your pregnancy even though it was a pre-existing condition that began less than six months ago.

Time Limit for Exclusions

• Twelve months is the maximum time period an employer can exclude a pre-existing condition. So, if you were diagnosed with an illness five months before applying for health insurance, your employer can exclude coverage for that condition because it occurred less than six months ago. However, a year after you begin enrollment in your plan, the employer can no longer exclude coverage for that illness, and the insurer must begin paying for treatment under the standard compensation rules of the benefit plan.