Individual Guaranteed Issue Plans — Guaranteed Issue Plans, Coverage & Quotes
Finding a health insurance plan can be difficult when you have a pre-existing condition. There are a surprising amount of ailments that make buying a health insurance plan on the open market a struggle. These barriers include (but are not limited to) many common chronic conditions, such as diabetes and high blood pressure; as well as a current pregnancy. The vast majority of health insurance plans will refuse to cover someone who is battling or has battled any type of cancer. A past heart attack or stroke may also cause insurance companies to reject you. This results in a vicious cycle: when one health insurance company rejects you, it leaves a black mark on your record; other non-guaranteed issue plans are then more likely to reject you as a result.
Many insurance companies will refuse to write a policy for an individual they consider too much of a risk. As for-profit companies, they earn money by enrolling millions of healthy consumers while hoping to pay out as few claims as possible. Understandably, health insurers do not want to take on someone that already has a known health problem. If the average health insurance plan agrees to cover you, that coverage may exclude any treatment involving any pre-existing conditions! Obviously, health insurance that doesn’t cover the health care you need is very inconvenient. These circumstances leave people most in need of health insurance between a rock and a hard place. Guaranteed issue health insurance or a pre existing health insurance may be the solution for you.
What is a guaranteed issue plan? It is a type of health insurance plan that is required to provide coverage for all applicants, regardless of health status or risk. All group health insurance plans are guaranteed issue, which is why employer-sponsored plans accept almost all employees that sign up. Their underwriting standards are looser–making them guaranteed issue health insurance plans–because the health insurance company is able to spread the cost of treatment among a large group. If the majority of a workforce is healthy, health insurers can afford to take on a handful of unhealthier people that are more expensive to insure. However, such cost-sharing isn’t possible when buying health insurance as an individual; insurance companies have to be certain that they can still turn a profit based on your policy alone. Therefore, you are less likely to be approved by their underwriters. You can turn to a guaranteed issue health insurance plan if you are unable to buy individual coverage.
In some states, all individual health insurance plans sold are guaranteed-issue. Other states do not have that requirement, although suitable plans are available nationwide. Guaranteed issue plans tend to be comprehensive: they cover doctor and hospital visits, and both inpatient and outpatient health care. Many also cover prescription medications. The trade-off is that guaranteed issue health insurance is normally more expensive than standard managed care plans. Health insurance companies need to earn their shareholders profit somehow, so they raise premiums for those individuals they consider highly likely to file a greater number of expensive claims. Another pitfall of guaranteed issue health insurance policies is the fact that many of them force you to wait a year before your pre-existing condition(s) are covered. While this is preferable to insurers refusing to cover them altogether, this can result in financial and medical hardship.
Ideally, you should buy health insurance while you are still healthy to ensure coverage in case you fall ill. Instead of waiting for guaranteed issue health insurance, you can get insured at a lower rate. Health insurance companies want to discourage individuals from waiting to buy insurance until they are in bad health; doing so circumvents their entire business model. Still, bad things happen. Although guaranteed issue health plans should be considered a last resort, there are certain circumstances in which they can be helpful. For example, if you are unemployed and were either unable to afford continuing your group coverage through COBRA or saw your COBRA benefits expire, a guaranteed issue plan could work for you.
Ask VitalOne about your guaranteed issue individual health insurance options. Our plans use Multiplan–the nation’s largest PPO network–resulting in greater savings for you. We have licensed insurance agents available and able to answer your questions and help you choose the plan that best fits your needs.
