January 2008
Disqualified for individual health insurance
When Michael Miano, 61, of Abingdon, Va., first sought to buy individual insurance in 2003 after leaving a federal regulatory
position and exhausting his COBRA benefits, he was distressed to learn that he was uninsurable.
"I've been diagnosed with diabetes but I'm perfectly healthy," he says. "I follow a strict diet. I'm not overweight and I walk 20 miles a week. I check my glucose levels regularly. I take oral medication, and my diabetes is completely under control."
His problems result from the practice called medical underwriting. It's illegal nationwide for insurers to discriminate against people in group plans on the basis of their health. But in all but a handful of states, medical underwriting for individual plans is allowed. Here's how it works:
If you want an individual policy, you must fill out a detailed health-history questionnaire and might be asked to submit the results of a recent physical exam or have blood or urine tests. The insurance company might look up your prescription records in the databases of pharmacy benefit management companies.
If the company doesn't like what it sees, in many states, it can flatly turn you down, quote you a much higher premium, or offer you insurance that covers everything except the health conditions it doesn't like. Applicants for individual health insurance quickly learn that although they consider themselves healthy, insurers may not.
Health Net, for instance, lists "diabetes, once diagnosed, all treatments" on its list of "declinable conditions." Diabetes is one of a lengthy list of conditions that will automatically get you into state high-risk pools, special insurance products maintained by 34 states for people who can't find themselves disqualified for individual health insurance on the open market.
"It sounds harsh, but insurance is an actuarial science that looks at the likelihood of something happening and what the cost will be," says Janet Trautwein, chief executive officer of the National Association of Health Underwriters. "When a diabetic does have complications, they are unbelievably expensive, and that's why a diabetic is always turned down, even if they're running marathons."
But conditions that most lay people would consider less serious than diabetes will also get you disqualified for individual health insurance. PacifiCare may decline anyone who takes prescription medications for high blood pressure, acid reflux, asthma, migraines, arthritis, or depression. Aetna won't insure anyone who's had a hip or knee replacement.
"I've been diagnosed with diabetes but I'm perfectly healthy," he says. "I follow a strict diet. I'm not overweight and I walk 20 miles a week. I check my glucose levels regularly. I take oral medication, and my diabetes is completely under control."
His problems result from the practice called medical underwriting. It's illegal nationwide for insurers to discriminate against people in group plans on the basis of their health. But in all but a handful of states, medical underwriting for individual plans is allowed. Here's how it works:
If you want an individual policy, you must fill out a detailed health-history questionnaire and might be asked to submit the results of a recent physical exam or have blood or urine tests. The insurance company might look up your prescription records in the databases of pharmacy benefit management companies.
If the company doesn't like what it sees, in many states, it can flatly turn you down, quote you a much higher premium, or offer you insurance that covers everything except the health conditions it doesn't like. Applicants for individual health insurance quickly learn that although they consider themselves healthy, insurers may not.
Health Net, for instance, lists "diabetes, once diagnosed, all treatments" on its list of "declinable conditions." Diabetes is one of a lengthy list of conditions that will automatically get you into state high-risk pools, special insurance products maintained by 34 states for people who can't find themselves disqualified for individual health insurance on the open market.
"It sounds harsh, but insurance is an actuarial science that looks at the likelihood of something happening and what the cost will be," says Janet Trautwein, chief executive officer of the National Association of Health Underwriters. "When a diabetic does have complications, they are unbelievably expensive, and that's why a diabetic is always turned down, even if they're running marathons."
But conditions that most lay people would consider less serious than diabetes will also get you disqualified for individual health insurance. PacifiCare may decline anyone who takes prescription medications for high blood pressure, acid reflux, asthma, migraines, arthritis, or depression. Aetna won't insure anyone who's had a hip or knee replacement.
