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Can group health insurance deny you coverage for a pre-existing condition? Consumer Q&A

By on November 9th, 2012
Filed: Advice, Consumers, Health Insurance, You, Young Adults

One big difference between group health insurance and individually-purchased health insurance is how each treats pre-existing medical conditions. This is basic stuff, but it’s a point of perennial confusion – especially for young adults and people who aren’t used to how employer coverage works.

Last week on Yahoo Answers we took a question from a young man covered under his mother’s health insurance plan. She’s changing jobs, however, and will be enrolling in a new employer’s group health insurance plan soon.

The asker wanted to know: Can I be declined for group coverage based on a pre-existing condition? What’s the difference between employer-sponsored and individually-purchased health insurance in this regard?

The eHealthInsurance reply was voted Best Answer:

In most states, you can still be declined coverage for individually-purchased health insurance due to a pre-existing medical condition. In NO states, however, is this true of employer-based health insurance. So long as you’re under age 26 and your mom keeps you enrolled, you cannot be turned down coverage due to a pre-existing condition under your mom’s new employer-based health insurance plan.

That said, though you cannot be outright declined coverage, you can face a waiting period of up to six months before medical bills for treatment of a pre-existing condition are covered. That waiting period can be reduced or waived, however, if you were covered under a previous health insurance plan without any gap of more than 63 days prior to enrolling in the new plan.

Why the difference between individually-purchased coverage and employer-based coverage? Good question. Rather than go into the history of it, though, it’s best to say that that’s just the way it is and it’s been that way for a long time.

However, that will change in 2014 when the last big provisions of the health reform law come into effect. As of January 1, 2014, no one can be turned down for health insurance due to a pre-existing medical condition, period. In that respect, individually-purchased coverage will work like employer-based health insurance works today.

Image by Flickr user DorkyMum


About Douglas Dalrymple

Doug Dalrymple is a member of the communications team at eHealth, Inc. and has worked in the health insurance and technology industries for fifteen years. He works on communications strategy, content creation and management, project management, and corporate messaging.

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