Pre-Existing Condition Exclusion Period

Pre-Existing Condition Exclusion Period

The pre-existing condition exclusion period is a health insurance benefit provision that places limits on benefits or excludes benefits for a period of time due to a medical condition that the policyholder had prior to enrolling in a health plan. The pre-existing condition exclusion period is a health insurance benefit provision that places limits on benefits or excludes benefits for a period of time due to a medical condition that the policyholder had prior to enrolling in a health plan. A pre-existing condition exclusion period limits the number of benefits that an insurer has to provide for specific medical conditions, and does not apply to medical benefits afforded by a health insurance policy for other types of care. Pre-existing condition exclusion periods are regulated policy features, meaning that the insurer is likely to have an upper limit on the period of time the exclusion period will last. Insurers have to provide a written notice indicating that a pre-existing condition is being applied, and the exclusion period countdown begins immediately after any plan-required waiting period.

In the past, if individuals could prove that they had creditable coverage before joining the new plan the exclusion period could be waved.

What Does Pre-Existing Condition Exclusion Period Mean?

The pre-existing condition exclusion period is a health insurance benefit provision that places limits on benefits or excludes benefits for a period of time due to a medical condition that the policyholder had prior to enrolling in a health plan.

The Affordable Care Act's passage has blocked many insurers from being able to use this exclusion period but it does still occur. This happens usually because the periods have legacy acceptance into previous policies. Medicare typically covers pre-existing conditions without lengthy waitlists.

In the past, if individuals could prove that they had creditable coverage before joining the new plan the exclusion period could be waved.
Some insurance carriers still have pre-existing condition exclusion periods but not many, thanks to the passage of the ACA.
Insurers in some states could have restrictions added on whether they can include a pre-existing condition exclusion period.

How the Pre-Existing Condition Exclusion Period Works

A pre-existing condition exclusion period limits the number of benefits that an insurer has to provide for specific medical conditions, and does not apply to medical benefits afforded by a health insurance policy for other types of care. For example, a policyholder may be excluded from receiving benefits for a pre-existing heart condition for a period of months after starting a policy, but may still receive care for non-preexisting conditions, such as the flu.

Conditions for Exclusion

The Health Insurance Portability and Accountability Act of 1996 (HIPAA) requires insurers to provide coverage to individuals in group health plans and places restrictions on how insurers can restrict some benefits.

It set guidelines on how and when insurers could exclude health coverage from individuals who had pre-existing conditions before joining the policy. HIPAA allows insurers to refuse to cover pre-existing medical conditions for up to the first twelve months after enrollment, or eighteen months in the case of late enrollment.

Pre-existing condition exclusion periods are regulated policy features, meaning that the insurer is likely to have an upper limit on the period of time the exclusion period will last.

Individuals can reduce the pre-existing condition exclusion period by proving that they had creditable coverage before joining the new plan. The individual can prove this by showing a certificate of creditable coverage produced by the previous insurer or may offer other forms of proof.

Insurers have to provide a written notice indicating that a pre-existing condition is being applied, and the exclusion period countdown begins immediately after any plan-required waiting period. In some states, insurers may have additional restrictions placed on whether they can include a pre-existing condition exclusion period.

The ACA and Pre-Existing Health Conditions

Under the Affordable Care Act passed in 2010, "Health insurers can no longer charge more or deny coverage to you or your child because of a pre-existing health condition like asthma, diabetes, or cancer. They cannot limit benefits for that condition either. Once you have insurance, they can't refuse to cover treatment for your pre-existing condition."

Related terms:

Affordable Care Act (ACA)

The Affordable Care Act (ACA) is the federal statute signed into law in 2010 as a part of the healthcare reform agenda of the Obama administration. read more

Catastrophic Illness Insurance

Catastrophic illness insurance covers expenses for major health conditions such as heart attack, stroke or cancer, but does not cover routine care. read more

Creditable Coverage

Creditable coverage is a health insurance, prescription drug, or another health benefit plan that meets a minimum set of qualifications. read more

Grandfathered Health Plan

A grandfathered health plan is an insurance policy that is exempt from many consumer protections under the Affordable Care Act (ACA). read more

ACA Health Insurance Marketplace

The Health Insurance Marketplace was established under Affordable Care Act and offers plans to individuals, families, and small businesses. read more

Health Insurance

Health insurance is a type of insurance coverage that pays for medical and surgical expenses that are incurred by the insured.  read more

Health Insurance Portability and Accountability Act (HIPAA)

Health Insurance Portabiilty and Accountability ACT (HIPAA) is an act created by the U.S Congress in 1996 to ensure the privacy of personal medical data. read more

Medicare

Medicare is a U.S. government program providing healthcare insurance to individuals 65 and older or those under 65 who meet eligibility requirements. read more

Preexisting Condition

A preexisting condition is an illness or health condition that existed prior to applying for health or life insurance. read more

Waiting Period

For insurance, a waiting period is the amount of time an insured must wait before some or all of their coverage comes into effect.  read more