Pre-Existing Conditions and the Affordable Care Act

Prior to 2014, health insurance companies had a long list of reasons that they could use to reject coverage for certain applicants. A big part of that list was pre-existing conditions that ranged from diabetes to cancer. Women who were pregnant also had a hard time finding health insurance, arguably at a time when they needed it the most.

From 2007 to 2009, the number of people being declined for health insurance due to pre-existing conditions increased by 49 percent. When the Affordable Care Act (also known as Obamacare) took effect in 2014, the law carried a 53 percent disapproval rate with the American public.

By 2015, people had been signing up for Obamacare plans and realized that their pre-existing conditions were not preventing them from getting covered. By August 2015, the disapproval rating for Obamacare had dropped to 40 percent. Based on consumer surveys, the ability to get coverage with pre-existing conditions was a huge factor in the growing popularity of the ACA.

How Pre-Existing Conditions Work with the ACA

Under the Affordable Care Act, no health insurance provider can deny you coverage or charge you higher rates if you have conditions that existed before you submitted your application. This includes women who become pregnant before signing up for insurance.

The ACA also makes it illegal for insurance companies to raise the premiums of someone with pre-existing conditions after their policy has started, and it’s also illegal for insurance companies to cancel coverage that has already been started on someone who has pre-existing conditions. The wording of the ACA is very specific on what health insurance companies can and cannot do when it comes to covering people with pre-existing conditions.

Under Obamacare, insurance companies cannot alter the coverage of a person with pre-existing conditions in any way. For example, an insurer can’t drop prescription medication coverage from the plan of a person who had signed up with pre-existing conditions after the policy was already in effect. Insurance companies are also not allowed to offer abridged policies to people with pre-existing conditions.

The Grandfather Clause

There is a grandfather clause in the ACA that states that as long as policies were purchased on or before March 23, 2010, and have not had any significant changes made to them, these plans would not have to alter their provisions to accommodate people with pre-existing conditions.

This grandfather clause was a way to make sure that people who liked their existing plans could keep coverage that they already knew and wanted, and it in no way affects any of the plans offered on the marketplace. But you don’t have to keep a grandfathered plan if you don’t want it. If you want to explore the new options available under the ACA, then you can do so during open enrollment, which runs from November 1 through January 31, 2017 for coverage in 2017.

Before the ACA

Prior to the passage of the ACA, it was very difficult for the government to regulate how health insurance companies could treat people with pre-existing conditions. There used to be a Pre-Existing Insurance Coverage Plan (PCIP), which was a federal program that offered coverage to people who had not been insured for the previous six months and were denied coverage due to a pre-existing condition. When the ACA went live in 2014, the PCIP was dissolved.

Trumpcare and Pre-Existing Conditions

The pre-existing conditions provision of the ACA was both a blessing and a curse. The blessing came when millions of people who could not previously get health coverage were able to buy coverage at reasonable rates. The curse came when insurance companies were forced to raise premiums on all consumers to cover the extra costs associated with covering costlier medical problems, like heart disease and diabetes. Healthcare industry advocates are hoping that Trumpcare, president-elect Trump’s version of health care reform, will do something to help insurance companies balance the high cost of care with quality coverage for people who really need it.

Where the ACA is very specific in its wording in regards to pre-existing conditions, Trumpcare is vague. Donald Trump has said that he believes that everyone should have access to affordable health insurance, even people with pre-existing conditions. However, Trump has not ruled out the possibility of:

  • Allowing companies to charge more for people with pre-existing conditions
  • Allowing companies to offer abbreviated coverage for people with pre-existing conditions
  • Allowing companies to alter coverage or premium costs on people with pre-existing conditions after their coverage has started

The Affordable Care Act closed a huge gap in health insurance that people have been concerned about for years. When the ACA outlawed treating people with pre-existing conditions differently from healthy people, millions of Americans rejoiced and were finally able to get affordable health insurance. Now that the ACA has an uncertain future thanks to the election of Donald Trump as president, those millions of Americans could find themselves out of luck when it comes to getting affordable coverage.