When it comes to health insurance, pre-existing conditions are a big issue for people facing loss or change of coverage. Federal and state laws make the issue murky since different rules apply to different types of group plans.
First, what is a pre-existing condition? Basically, it is any physical condition that existed prior to a certain point in time. For our purposes, that point in time is the start date of a new health insurance policy or the start date of your waiting period. For insurance purposes in Washington, a pre-existing condition is a physical condition for which a person received medical care or was advised to receive care within 6 months of the coverage start date.
Second, different plans are dictated by different rules. Some plans are created and regulated under a federal law known as the Employment Retirement Income Security Act (ERISA). Other health plans are governed by state law. You may need to ask your employer to find out which kind of plan you are on.
Here are the basic pre-existing condition exclusion rules for group coverage in Washington currently:
- Self-funded employers (ERISA) can exclude pre-existing conditions for 12 months.
- State regulated plans with 50 or more eligible employees can exclude pre-existing conditions for 3 months.
- State regulated plans for small groups (2 to 50 employees) may require a 9-month exclusion period.
If you have coverage at one job then change to the new insurer at a new job, the new insurance company must give you credit for the coverage you had with Employer 1 as long as you have not had a significant lapse in coverage (defined as 63 or 90 days, depending on the plan). If, for example, you had continuous coverage for 2 years and the new carrier would impose a 9-month pre-existing exclusion, the new carrier has to give you credit for the prior 2 years of coverage. In effect, they will not exclude pre-existing conditions as long as you have not had a break in coverage between the policy periods. If you had coverage for 2 years on one plan then had 4 months with no coverage (lapse in coverage), the new carrier would not have to give you any credit for your prior coverage and could impose the maximum exclusion period.
Talk to your employer or insurer about what type on plan you have and what you can expect regarding pre-existing conditions if you are faced with a change of coverage.