Pre-Existing Conditions And How They Can Affect Your Individual Health Insurance

There are nearly four million Texans with some type of "pre-existing medical condition." Besides having difficulty obtaining health insurance, these Texans may experience other insurance-related problems, including claim denials, higher premiums, cancellations, or refusals to renew their policies.

Before issuing a policy, health insurance companies offering individual policies evaluate certain information about you to determine how likely you are to have a claim. This is called "underwriting." For any health policy, a company might consider your age, occupation, current health status and your medical history. If your individual risk factors indicate you are likely to have a claim, the company may charge you more for your policy or refuse to cover you.

Most individual health insurance companies have clauses regarding pre-existing conditions. Limits on pre-existing conditions are a standard part of most health plans. These limits ensure that benefits are paid only for conditions that occur after your health coverage becomes effective. Paying only for approved services and covered conditions helps control healthcare costs and prevent possible insurance abuse.

If you are seeking an individual health insurance policy and you have a current or past health problem, you must disclose it on your insurance application. Failure to disclose pre-existing conditions could jeopardize future claims or invalidate the policy. Individual health insurance companies may completely exclude coverage for pre-existing conditions by attaching an "exclusion rider" to your policy.

If you list pre-existing conditions on your application and the company issues you coverage without attaching an exclusion rider, the company must begin covering your pre-existing conditions when the policy's pre-existing waiting period expires. Pre-existing condition waiting periods can be a maximum of two years on individual policies. Exclusion riders can be in-force indefinitely.

In Texas, if you move from a group, government, or church health plan to an individual health policy, you won't be subject to a new pre-existing condition waiting period if you had 18 months of prior coverage, with no more than 63 days lapse in coverage. If you move from a group, government, or church health plan to an individual policy with less than 18 months of coverage or have a lapse in coverage greater than 63 days, you will receive credit on the new policy's pre-existing condition waiting period for the time you were covered during the preceding 18 months.
When it comes to applying for an individual health insurance policy, be forthcoming and honestly answer all questions about your medical condition. If you withhold information about an illness or medication, the health insurance company you're applying to may deny subsequent claims.

In addition, understand your individual health insurance policy and read the policy wording carefully. Make sure you understand the limitations and exclusions of your coverage. And ask questions, especially if you don't understand the policy wording, or are unsure about specifics of your coverage. Don't be afraid to ask for clarification about policy details. If you do not understand some or all of your policy, call your health insurance company and ask for an explanation. And try to get your answers in writing.