Limitations of Health Insurance
Most health insurance plans have limitations. Health insurance companies cannot cover everything for everyone. Your health insurance policy will normally list particular medical needs that will not be covered or for which they offer extremely minimal coverage. It is important to know what the restrictions of your particular policy are. We will describe here the most frequent limitations of health insurance that you should be aware of.
Renewability Provision
If a health insurance policy does not include a renewability provision, the insurance company could cancel your policy if you become ill. You should make sure there is a renewability provision in your policy.
Lifetime Payout Provision
This is the maximum the health insurance provider will pay for your health care in your entire lifetime. This may be 1 million dollars or more. As a consumer, you are protected by a similar provision - an out-of-pocket maximum. This is the most you will have to pay toward your health care (usually per year). The lifetime payout provision and out-of-pocket maximum amounts will affect your premiums, so you will need to balance the risk with the cost of the health insurance policy.
Waiting Periods & Pre-existing Conditions
Pre-existing conditions may not be covered by your health insurance until after a waiting period has passed, the length of which may be different state-to-state. This can vary greatly, so be sure to check your policy information. A good policy should cover pre-existing conditions within a year. In some policies, pre-existing conditions are not covered at all.
Prerequisites
This is the list of hoops you have to jump through in order to obtain medical attention. There have to be some restrictions, but be certain your health will not be sacrificed because there are too many steps required before you can seek medical care.
Exclusions, Limitations, and Definitions
These are very important sections in your policy. These sections will explain what is paid for, for how long, and when it might not be paid for. If you're confused by all the legalese, ask your licensed agent to explain them to you. Treatments such as physical therapy, which may last many months or even years, might be restricted to a time period or dollar amount or entirely excluded.
Frequent Exclusions
-Experimental treatments and preventative care
-Non-prescription drugs
-Infertility treatments
-Birth control
-Dental expenses (most policies do pay for dental work needed as a result of an accident)
-Cosmetic surgery (most policies do cover cosmetic surgery needed as a result of an accident or congenital defect)
-Care covered by other insurance companies or providers (workers compensation, VA, or other organizations)
-Learning and behavioral issues
-Psychiatric care
-Alcohol and drug abuse treatment
-Sexually transmitted diseases
-Injury, illness, or death while under the influence of alcohol or drugs
-Injury, illness, or death while committing a crime
-Vision care and correction
-Hearing aids
-War related injuries or other health care needs; military service typically suspends the insurance policy
-Self-inflicted injuries
-Noncommercial airline travel
Riders
Riders are addendums to your health insurance policy that may increase or decrease the coverage written in the policy. Often you can purchase a rider that provides more coverage in a particular capacity, such as mental health care or alternative medicine.
Common Riders
-Disability or other supplemental coverage
-Waiver of premium
-Exclusion or impairment rider normally employed to exclude a pre-existing condition
State and federal laws protect you from losing your health coverage just because you lose your job. Unfortunately, they do not offer protection from high premium costs.
Other Legal Information
When Congress passed the Health Insurance Portability and Accountability Act (HIPAA) in 1996, it mandated that all states provide a place of last resort for individuals to buy health insurance--a kind of safety net for individuals seeking coverage. HIPAA did not, however, come close to solving the issues individuals face and essentially left the overall marketplace unchanged. The law did not ensure, for example, that everyone needing health insurance can obtain a policy regardless of health status. HIPAA set minimum standards for providing coverage of last resort, but it let every state devise its own rules. The result has been a hodgepodge of regulations that differ from state to state and provide varying levels of assistance for consumers.
Only 11 states and the District of Columbia guarantee all residents the right to buy health insurance no matter how sick they are. Twenty-two states guarantee a policy to residents who are uninsurable simply because of their health, as well as to people who have satisfied HIPAA's complex rules. That means they must have left a group plan, paid their own premiums for COBRA (Consolidated Omnibus Budget Reconciliation Act) coverage, and applied for new coverage within 63 days after leaving the group plan.
The most restrictive states--such as Alabama, Arizona, Delaware, and West Virginia--permit only residents who have satisfied HIPAA requirements to buy what is called a guaranteed-issue policy, that is, a policy you are permitted to buy regardless of any medical condition you have. Several states limit the amount carriers are permitted to charge for policies of last resort, but even these limits can produce some extremely expensive policies. So if you qualify for a guaranteed-issue policy, you may find the premiums out of reach.
The Congressional Budget Office estimated that HIPAA would help as many as 3 million individuals. Although there has been no national study, it's increasingly apparent that the total number of individuals helped under the law is nowhere near the original estimates.
Connect With Health Insurance Agents Now By Filling Out The Quick Form At The Top Of The Page.
USInsuranceOnline provides referrals to health insurance agents so consumers can compare prices and save money.
