Denied Health Coverage? This Plan Could be For You

Millions of uninsured could benefit under the new Pre-Existing Condition Insurance Plan

Right now, insurance companies can deny you or revoke coverage just because you get sick. Develop cancer, lupus, diabetes, asthma–even hay fever–and your insurer can say sorry, we’re not going to cover that.

That practice will end in 2014, when the rules of the game change as part of the healthcare reform measure passed by Congress in March. But if you’re ill and uninsured, you need not wait that long to get insurance. The government's new Pre-existing Condition Insurance Plan, rolled out on July 1, will grant anyone who has been denied coverage within the last six months, and has been uninsured at least six months, coverage for doctor’s visits, hospital stays and medications.

The plan’s primary goal is to improve healthcare, and ease the financial burden of paying out of pocket, for those who are denied insurance because they’ve been sick or are currently sick. Many of the estimated 12.6 million Americans in that category are self-employed or don’t have coverage through their jobs, like Jon’ette Jordan, an entrepreneur who excitedly logged onto the healthcare.gov website as soon as she heard the news. Jordan had been denied coverage based on her sickle cell anemia, a genetic disorder.

“There are so many things I need to see a doctor for and it’s simply unaffordable to do so out of pocket,” says Jordan. “I have to keep trying.”

Being approved wasn’t as easy as she’d hoped because of the rule that requires applicants to have been denied insurance within the last six months. Her last denial came more than a year ago. But she hopes she can get a new denial letter that will make her eligible once the California plan starts accepting applications July 15.

The PCIP is not a permanent solution. It’s meant to bridge the coverage gap for people like Jordan between now and 2014, when the insurance exchanges created under the Affordable Care Act are set up. At that time, the PCIP will be dissolved and its members will be able to purchase insurance from companies in the exchange. Also that year, insurance companies will no longer be allowed to discriminate against anyone based on their health status (though children with health issues will no longer be able to be denied coverage as of Sept. 23, 2010).

So far, reviews of the PCIP plan have been mostly positive. But there are some concerns among health advocates. DeAnn Friedholm, director for health reform at Consumer’s Union, points out that people who are insured but are paying exorbitant rates for their coverage, for example, will not qualify for the plan. And the plan’s rates themselves are not cheap. The Department of Health and Human Services estimates that a 50-year-old enrollee would pay between $328 and $675 per month for coverage, depending on where she lives. Still, she says the plan does succeed in meeting the needs of most people in its target group: those too young for Medicare, too wealthy for Medicaid and too poor to afford private insurance.

“Are there aspects we'd rather see done a different way? Absolutely,” says Friedholm. “But the pieces that are moving are going to be making very positive changes for consumers.”

Mary Crimmings, vice president of marketing, communications and advocacy at the Lupus Foundation of America, agrees that the PCIP is a step in the right direction as the program could help ease the financial burden on patients who currently have to pay out of pocket for medications and medical treatment. Still, only time will tell how much the plan eases that burden.

“The program is brand new,” she says. “We don’t know how much it will help people. We’re trying to get as much information out there and will then track people to see how they fare with this new option.”

To learn more about the PCIP, log onto www.healthcare.gov.

Do you have health insurance? Why or why not? Chime in below.

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