Underwriting how health insurers react

Compare health insurance quotes.
Find affordable health insurance and apply online.

Underwriting how health insurers react

A number of factors come into play when a person applies for health insurance. These can include health status, age, state of residence and other variables. Read on to learn about the health insurance industry's criteria for determining an individual's insurability.
 
What is "medical underwriting"? It is the process health insurers use to assess the risk of insuring a particular individual or group. In most states, consumers seeking coverage in the individual insurance market can be turned away or charged more if they are older or in poor health. Consumers won't know if they qualify for coverage or what their monthly premiums will be until this process is completed. Five states - Maine, New Hampshire, New Jersey, New York, and Vermont - guarantee access to coverage without regard to health status.
 
What does the underwriting process involve? Typically, an individual must complete an application, including a questionnaire about his or her current health status and health history. Sometimes insurers request additional information, including copies of medical records. In some cases, an applicant may be asked to provide a blood, urine or saliva sample. Sometimes, there is a physical examination.
 
What conditions may trigger a denial? Many states require insurance companies to maintain a "high risk pool" for those who have been rejected, so technically, no one who applies for health insurance is turned down. However, the premiums may be very expensive and have limits on how much a policy will pay. While the list varies by state and by insurance, here are a few examples of conditions that may trigger a denial: HIV, pregnancy, anorexia nervosa and other severe eating disorders, chemical dependency, coronary heart disease, and hemophilia.
 
Can a history of mental disorders trigger a denial? People with mental disorders face even greater challenges gaining access to affordable coverage than people with various medical conditions. Some carriers deny coverage because they believe the costs associated with treating mental health problems are more variable and less predictable than those associated with other chronic health conditions, according to a government report.
 
What is an exclusion rider? Sometimes an insurer will approve a policy but place limits on the benefits it will cover. The policy may carry an amendment, or "rider," that specifically excludes coverage for a pre-existing condition or for a body part of body system affected by that condition.
 
What recourse do applicants have when they are denied coverage? Most states maintain "high risk" health insurance pools to cover people who are turned down. However, these policies are more expensive than those offered by private health insurers. In some states, a person with one or more uninsurable conditions is automatically eligible for coverage in the state risk pool.
 
How truthful do I have to be on an application? Insurance brokers advise clients to respond truthfully. If you provide false information on an application and then file a claim, the insurer has the right to cancel the policy or raise your premium.
 
SOURCES: How Accessible Is Individual Health Insurance For Consumers In Less-Than-Perfect Health? (June 2001), Henry J. Kaiser Family Foundation, Menlo Park, Calif.; National Association of Health Underwriters, Arlington, Va.; Private Health Insurance: Access to Individual Market Coverage May Be Restricted for Applicants with Mental Disorders (February 2002), United States General Accounting Office, Washington, D.C.
eHealthInsurance is the nation's leading online source of health insurance. eHealthInsurance offers thousands of health plans underwritten by more than 180 of the nation's health insurance companies, including Aetna and Blue Cross Blue Shield. Compare plans side by side, get health insurance quotes, apply online and find affordable health insurance today.
Most usable health insurance exchange: ehealth