Health Care: Lost Coverage, Pre-Existing Conditions and Exclusions

By Jason Freeman, J. Freeman and Associates

Lost Coverage
It’s human nature. Negative news tends to get our attention a whole lot quicker than warm, fuzzy, feel-good news. And, there’s a lot of negative news out there about Obamacare.

Not a day goes by that we don't get a call that starts off with, “I'm losing my coverage,” or “I heard my friend is being dropped. Am I going to be dropped, too?” Here are a few reasons why you may be dropped from your plan:

• The insurance carrier is exiting the marketplace – Some insurance carriers have plans that are not making them any money, or that do not provide coverage that meets the new federal mandate.
• Your employer is dropping the group coverage – Many employers can't afford to keep up with the increase in costs. Small businesses with less than 50 employees are not required to provide health insurance, and even large employer groups may find it less expensive to pay the fine than to provide medical coverage.
• Your spouse’s employer is no longer offering family coverage – In an attempt to maintain corporate earnings, some employers may choose to pay for coverage for the employee only. Even if they do allow for family members on the policy, the portion that you would have to pay may be so high, that you would be better off finding a policy elsewhere.

Pre-Existing Conditions
One reason your coverage will never be dropped, is for a pre-existing condition. A key component of the new health care law is that insurance companies can no longer charge more or deny coverage to those with pre-existing conditions.

As of January 1, 2014, insurers are also not allowed to limit the dollar amount of health benefits—either annually or over a lifetime. And, you can not be dropped or denied coverage when you get sick.

Exclusions
The ACA’s “individual mandate” requires all Americans to have some form of health insurance, or pay a fine. But, as with everything in life, there will always be some exceptions to the rule. Those exempt from penalties for noncompliance, include:

• Prisoners
• Indian tribal members (Native American descent)
• Members of certain religious groups or health care sharing ministries (HCSM)
• Anyone uninsured for less than three months per year (e.g., during a job transition)
• Those with incomes too low to require a federal tax return
• Individuals that have suffered a hardship (available on a case-by-case basis)

There is still much to learn as we navigate this ever-changing landscape of health care reform. But it is our mission to educate our clients, answer questions and assist in the transition.