Looking to enroll in a new individual or family health insurance plan? Don’t submit an application for health insurance until you read this!
The passage of the Affordable Care Act in 2010 changed how the American public shops for health insurance.
The most obvious example of the changes can be found in the health insurance marketplaces or exchanges created in the ACA’s wake. People without adequate health coverage can use these federal or state-run websites to find and buy coverage.
Another example becomes visible when a person fills out an application for an individual (or family) health insurance plans.
Before Obamacare, companies offering health insurance would ask people to include all sorts of information on their applications. For example, applications might include the date they’d like their coverage to be effective. Some ask whether they or anyone else named on the application was previously denied insurance or had an insurance policy canceled or rescinded.
Companies also asked applicants to share health details about themselves and any other family members looking for coverage. Insurers often used this information to determine a person’s premium rates. They also sometimes used this information, especially if it was incorrect, to terminate an approved insurance contract.
For the most part, the days of the above are over thanks to the Affordable Care Act. Applicants no longer have to identify when they want their coverage to go into effect. This is because most of them only can apply during certain, strictly defined “open enrollment” periods. These begin near the end of the year and the effective date of coverage for those folks usually falls on the first day of the following year.
(Some people will be able to apply for coverage outside of this window, during a “special enrollment period.” But they’ll have to have been kept from taking advantage of the open enrollment period by one or more of a handful of “life events.” These events are detailed in our article, “Understanding the Affordable Care Act.”)
Today, those applying for health insurance plans through the marketplaces no longer need to worry about providing the entire medical histories of themselves and their loved ones.
That’s because one of the main ACA reforms prohibited insurance providers from refusing to sell or renew plans because of pre-existing conditions. Nor can they charge higher rates because of a person’s health status.
One of the only health-related questions you'll find on an application is: have you used any tobacco products regularly within the last six months?
This question will show up from time to time. Just not on applications related to the federal health marketplace or even a few of the state-based ones. This is because the Affordable Care Act allows insurance companies to charge people who use tobacco products up to 50 percent more for premiums. It also allows states to mandate a lower percentage or no surcharge at all. A number of states have taken the government up on this offer.
The only other health-related questions you'll be asked on one of the state-run health insurance marketplaces are likely to be optional.
For example, LifeWise Health Plan of Washington's application includes a small section that asks people the following questions:
These questions aren’t included to deny coverage or increase the premiums. They’re asked so the provider can assist people who may answer "yes" to one or more of them.
Federal and state exchange applications focus on readily available information, including the names, genders, dates of birth, and Social Security Numbers of those named in the policy.
Health insurance applications also may ask you to share the following:
The point of these questions is to let you know if you qualify for any subsidies, credits, and the like. But some insurance companies will ask you to share this information for statistical purposes.
If you apply for health insurance after open enrollment has closed, you must specify if one or more “qualifying events” prevented you from picking a plan during that period.
Among the events that could qualify you to buy a plan as part of a special enrollment period are:
Earlier, it was mentioned that the Affordable Care Act lets insurance companies charge tobacco users up to 50 percent more for premiums.
Aside from that, companies can only use the following four pieces of information when determining your health insurance rates:
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