Pre-existing medical conditions
This is a hot topic in the healthcare reform efforts of 2010 and may well be abolished by the time this book is published. It is also a complicated topic, so I am careful to explain it in a way that does not bias for or against any party. If you cannot get health insurance because of a pre-existing medical condition, I recommend that you contact the Foundation for Health Coverage Education (www. coverageforall.org) and they will direct you to a high-risk insurance pool in your state that will cover you. I am going to use an extreme example to explain pre-existing medical conditions.
If every person in the United States was enrolled in one giant health plan, everyone would pay a very similar premium. We would simply take the total cost of care for this year divided by the total number of people covered. Everyone would pay the same amount because it would be easy to calculate the total costs and the total number of people. Our sample size would include everyone. All of the actuaries would be unemployed.
However, we are not all enrolled in one plan. We are enrolled in thousands of different plans. Some of us are old and some of us are young. Some of us smoke and some of us do not. Some of us jump from one plan to another every year and some of us stay in the same plan for a decade. All of this makes it very difﬁ cult for each insurance company to predict what the total cost of care will be for their respective plans.
As a result of these factors, insurance companies may keep a list of “pre-existing medical conditions” that require that a new enrollee be put on a “waiting period” in which he or she has to pay premiums into the plan for several months before becoming eligible for treatment to be covered.
The Health Insurance Portability and Accountability Act (HIPAA) of 1997 factors into this as well. In accordance with HIPAA, a patient that ﬁ nds new health insurance coverage within 63 days of the loss of their previous coverage may not be excluded for reason