June 03, 2011

Pre-Existing Condition Insurance Plan Updates

by Elesha Shahinllari, LFA Senior Director of Government Relations and Public Policy

The U.S. Department of Health and Human Services has announced that they will be taking new steps to reduce premiums and to make it easier for Americans to enroll in the Pre-Existing Condition Insurance Plan (PCIP) beginning on July 1st.  PCIP are available for people living with chronic Pre-Existing diseases who have been unable to obtain insurance.  

Under the new changes, premiums for the Federally-administered PCIP will drop by 40 percent in 17 states plus the District of Columbia.  In other states, premium reductions range from 2.1 percent in Mississippi to 38.3 percent in Minnesota.  These premium decreases help to bring PCIP premiums closer to the rates in each State’s individual insurance market; in the six states where PCIP premiums were already well-aligned with state premiums, premiums will remain the same.

Eligibility requirements for enrollment in PCIP will also be eased in 23 states and the District of Columbia to ensure that more Americans with pre-existing conditions have access to affordable health insurance.  To be eligible for the plans, applicants have to be uninsured for at least six months and have a pre-existing condition.  In the states where the plans are federally administered, applicants will no longer have to wait on an insurance company to send them a denial letter.  Instead, they can provide a letter from a doctor, physician assistant, or nurse practitioner dated within the past 12 months stating that they have or, at any time in the past, had a medical condition, disability, or illness.

Congress created the temporary PCIP program as part of the Affordable Care Act to help uninsured Americans with a variety of medical conditions get affordable coverage rather than be locked out of the system by insurance companies.  The plans are intended to serve as a bridge to help people with medical conditions until insurance market reforms required by the law are implemented in 2014.  At that time, insurers will no longer be able to deny coverage or charge higher rates for people with pre-existing conditions.  To learn more about how to enroll in PCIP, please visit www.pcip.gov.

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