Obamacare Got Me Insured

Published by WallStreetWeather.net

Writing and writing about economic and market cycles in particular is what I enjoy doing. But as the Supreme Court hears oral arguments on the Constitutionality of the one of the biggest economic and societal issues of our time, I must interrupt the regularly scheduled programming to tell you how this issue has affected me personally. (It is unlikely that the stock market is going to be doing anything radical in the immediate term anyway.)

If it wasn’t for Obamacare, I would not have health insurance coverage.

One of the key provisions of the Affordable Care Act (ACA) is that individuals with a pre-existing health condition can no longer be denied health insurance. As long as Obamacare remains law, starting on January 1, 2014 no one can be denied health insurance due to a pre-existing condition. Since Obamacare became law two years ago, individuals under 19 with a pre-existing condition can no longer be denied insurance and adults without insurance who have been rejected by an insurance company due to a pre-existing condition can purchase coverage through the law’s Pre-Existing Condition Insurance Plan (PCIP).

Most adults are covered by health insurance either through the government (Medicare and Medicaid) or their employer (group-based coverage). Federal law has always protected individuals enrolled in government or group-based coverage from being denied coverage due to a pre-existing health condition. No such protections apply to the individual health insurance market.

Since most Americans have never dealt with the individual health insurance market, there is a tendency to mistakenly assume that only people with conditions such as arthritis, asthma, diabetes, high blood pressure, obesity, and life threatening conditions such as cancer and heart disease are rejected for pre-existing conditions. But insurance companies are allowed to declare even a potential risk to be a pre-existing condition.

Even though I am in good health (and have been) and am normal weight, eat healthy foods, and exercise, no insurance company will issue me a policy at any price because my total cholesterol is slightly higher than the insurance company’s cutoff. (I have no other cardiovascular risk factors.) According to a 2011 report by the Centers for Disease Control, 1 in 3 adults in the U.S. has high cholesterol and would therefore be denied health insurance in the individual insurance market if Obamacare was no longer the law.

Furthermore, an HHS analysis estimates half of the U.S. adult population has a pre-existing condition of some kind. But I would say the government is underestimating the number since they did not mention other conditions/situations that cause insurers to routinely reject applicants such as Attention Deficit Disorder, mental stress, acne, allergies, and pregnancy. (A man can be rejected for a policy solely on the basis of being an expectant father.) Participating or planning to participate in martial arts, scuba and sky diving, hang gliding, and certain other sports and physical occupations can also be cause for rejection. Individual insurance applications have a “look back” period that ranges anywhere from two to ten years. You must also disclose on the application if a doctor recommended a course of treatment, medication, test, or procedure even if you did not do it.

Rejection by one insurance company means being rejected from all insurance companies. Every application asks if you’ve ever been rejected for health insurance and for what reason. Additionally, the information in your application can be shared with the other insurance companies through the Medical Information Bureau (MIB).

Unlike bankruptcy and most criminal sentences where the individual is given a second chance at life, health insurance companies do not give you a second chance to correct a condition once your application for insurance is rejected.

No other comprehensive healthcare solution has been brought to the table if Obamacare is either repealed or declared unconstitutional in its entirety. Despite all the talk of “freedom” and “choice,” it’s informative to examine the new freedoms that are already and will soon be available if Obamacare remains intact.

You cannot have freedom in commercial transactions without transparency. The major function of the insurance exchanges that begin operation in 2014 is to create a transparent marketplace where policies offered can easily be evaluated and selected. (Members of Congress will be required to get insurance from the exchange.) The elimination of medical underwriting will also allow individuals the freedom of migration from one state to another, one employer to another, and one insurance plan to another with no impediments.

Obamacare is very much a freedom enhancing vehicle that provides individuals with choices that have been unavailable for far too long.

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