Can Group Health Plans Reduce Cover As A Result Of A Pre-Existing Medical Condition?

There is often confusion when it comes to group health insurance schemes because, while a lot of people claim that group insurance plans cannot exclude you from cover because of your current health or your prior medical history, other people claim that they can in fact refuse cover for pre-existing medical conditions.

It is certainly true that you cannot be refused membership of a group insurance plan solely as a result of you current medical state, which includes any disability, or as a result of your prior medical history.

But, employers and insurers are allowed to question you about any pre-existing medical conditions when you join a plan or, if you submit 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 is the subject of your claim.

If a pre-existing condition is reported or found the employer or insurance company may not simply deny you coverage but may impose an exclusion period for coverage of that particular pre-existing condition. However, there are federal and state laws which limit the exclusions which employers and insurers are permitted to place on their group schemes.

Group health insurance schemes may not impose pre-existing condition exclusions on the basis of genetic information or for pregnancy. In addition, exclusions are not permitted for newborns, newly adopted children or children placed for adoption.

In general terms, pre-existing condition exclusions can only be imposed for conditions which are diagnosed within the 6 months before joining a group scheme for which you have been given (or been recommended to receive) treatment. This 6 month period is usually known as the 'look back' period.

When an exclusion period is imposed it cannot normally exceed 12 months and you must receive credit for any previous continuous creditable coverage. Here cover is classed as continuous as long as it has not been interrupted by a break of more than 63 consecutive days. Virtually all private and government sponsored health coverage is classed as creditable and this will include such things as Medicare, VA coverage, student health insurance, Medicaid, military health coverage, individual health insurance, Indian health insurance, foreign national coverage and much more.

If an employer requires a waiting period for people to enter a plan, or an HMO requires a similar affiliation period, these cannot be included in calculating any break in continuous coverage. In addition, pre-existing condition exclusion periods have to take into account the waiting or affiliation period with the pre-existing condition exclusion period beginning on the first day of the waiting or affiliation period.

When moving from one group plan to another then the administrator of the new scheme may examine your previous plan for the purpose of calculating any credit entitlement towards a pre-existing condition exclusion period for your new plan. This could mean for example that if your new plan provides cover which was not provided under the previous plan then exclusion periods can be imposed for pre-existing conditions which were not covered before but which are covered under the new plan.

One final point worth noting is that you have to be given appropriate written notice of any pre-existing condition exclusion period and the group plan administrator is obliged to help you to obtain a certificate of creditable coverage for your old plan if you wish him to do so.

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