Can Group Health Plans Refuse Coverage Because of Pre-Existing Medical Conditions?

When talking about group health insurance schemes there is usually confusion because, although some people claim that group health insurance plans may not refuse you cover on the basis of your present health or your prior medical history, others maintain that they are permitted to refuse cover for pre-existing medical conditions.

The truth is that you may not be denied membership of a group health insurance plan solely as a result of you present medical state, which includes any disability, or because of your past medical history.

However, both employers and insurance companies are allowed to question you about any pre-existing medical conditions when you join a scheme or, if you make a claim during your first year of coverage, to look back in order to establish whether you have any previous history of the condition which gives rise to the claim.

If a pre-existing condition is either reported or discovered the employer or insurer cannot simply refuse you coverage but is permitted to require an exclusion period for coverage of that specific pre-existing condition. Having said this, there are both federal and state laws which control the exclusions which employers and insurance companies may place on their group health schemes.

Group health insurance schemes may not apply pre-existing condition exclusion periods on the basis of either pregnancy or genetic information. In addition, exclusions are not allowed in the case of newborn babies, newly adopted children and children placed for adoption.

Generally speaking, pre-existing condition exclusions are only allowed for conditions which are diagnosed within the 6 months before joining a group health scheme and for which you have had (or been recommended to receive) treatment. This period is generally known as the 'look back' period.

Wherever a pre-existing condition exclusion period is imposed it may not usually exceed 12 months and you must be credited for any previous continuous creditable coverage. Here cover is classed as continuous if it is not interrupted by a break of more than 63 days in a row. Almost all private and government sponsored health coverage is classed as creditable and this will include such things as Medicare, individual health insurance, Medicaid, Indian health insurance, foreign national coverage, student health insurance, military health coverage, VA coverage and more.

When an employer imposes a waiting period for individuals to join a scheme, or an HMO imposes a similar affiliation period, these may not be included in determining any break in continuous coverage. Furthermore, any pre-existing condition exclusion period has to take into account the waiting or affiliation period with the exclusion period starting on the first day of the waiting or affiliation period.

When moving from one group scheme to another then the administrator of your new plan is permitted to look at your previous plan in order to work out any credit towards an exclusion period for your new plan. This might mean for example that if the new plan provides cover which was not provided under your previous plan then exclusion periods can be imposed for pre-existing conditions which were not previously covered but which are covered under your new plan.

One more point worth noting is that you have to be given appropriate notice of any exclusion period in writing and the group scheme administrator is obliged to assist you in obtaining a certificate of creditable coverage from your old plan if you wish him to do so.