| The individual health insurance market is very
different than the group plans that most people are used to. If
you lose a job, start a business, or need to seek private health
care for any other reason, you may find yourself in a whole new
world. In a group plan, insurers are guaranteed that even healthy
individuals pay in, limiting the chance that their new customers
will cost them more than they take in premiums.
The bottom line is that people enrolled in individual plans pay
premiums that are more in line with their expected health costs.
So the premium will obviously be higher if you are older or have
health problems. But many people are unaware that mental health
treatment, whether a single counseling visit or a prescription,
is often a reason for insurance companies to either deny coverage
or charge higher premiums.
Could This Be You?
"Lisa" is a 30-year-old nurse in excellent health that has, until
now, been covered by a group insurance plan at the hospital where
she works. However, she has decided to take the plunge and start
her own business, and has applied for individual health coverage.
But her request is turned down. Why? Because she truthfully answered
a question about two counseling sessions she attended five years
ago.
When she contacted the company (one of the largest insurance providers
in the United States), she was told that her request had been denied
because people with mental health problems are usually sicker than
those without them, And that itıs the companyıs policy not to offer
private coverage to anyone who has sought counseling, even marital
counseling.
"So basically your company is penalizing folks for getting help,"
Lisa said.
"That sounds a little harsh," the company spokesperson replied,
"but thatıs just our policy."
In addition, applicants may also be denied "private" coverage if
they have been counseled for anxiety, depression, grief, or an eating
or sleep disorder. If that sounds difficult, it gets harder if you've
ever been issued a prescription for these conditions.
Any History At All
Hard to believe, but stories like Lisaıs are not uncommon. According
to researchers at Georgetown Universityıs Health Privacy Project,
individual insurers may deny you coverage based on your medical
history if it includes the use of prescription drugs that treat
anxiety or depression. These "red flag" drugs include (but may
not be limited to) Ativan, BuSpar, Elavil, Klonopin, Librium, Paxil,
Prozac, Serzone, Valium, Xanax, Wellbutrin, or Zoloft.
Be aware that if you take any of these medications for a physical
condition, the same harsh standard may apply. Those who use
antidepressants to treat fibromyalgia, migraines, movement disorders,
pain, sleep disorders, or any other conditon treated by these medications,
are just as likely to get caught either paying higher premiums or
being denied coverage.
A survey of 116,179 people, conducted by a national news network,
found that those who had substance abuse, anxiety, depression or
other mental disorders had more problems with health insurance.
They are twice as likely to be denied insurance because of a pre-existing
condition, twice as likely to stay in a job more than two years
out of fear of losing health coverage and twice as likely to delay
getting medical help because of high out-of-pocket costs.
Unlike group insurance plans, most individual plans donıt lock
in individual rates for a year. So, instead of splitting the rate
hike with an employer, those with individual plans must shoulder
the increase alone. And the rub continues. Insurers can underwrite
individual plans, something they canıt do to employer groups. That
means they can ask medical questions and charge more for health
risks. Or simply refuse to provide coverage at all.
Some plans charge higher premiums if they take more than one prescription
drug. Some wonıt take people at all if they take anti-depressants.
Others steer clear of people with certain kinds of breast implants.
Twenty-eight states operate risk pools which offer comprehensive
insurance for people who typically have been denied private insurance
due to a pre-existing condition, such as heart disease, cancer,
AIDS, diabetes or other chronic illness. People in the programs
pay a higher premium than normal, but there is a cap set by law
on the level of premiums that can be charged.
Kaiser Family Foundation Investigates
In June of 2001, the Kaiser Family Foundation issued a report on
the availability of coverage for people with "less than perfect
health." The study was based on six hypothetical applicants, each
with a different medical problem, that applied for insurance coverage
in eight geographic areas (Ill., Texas, Iowa, Calif., Fla., Va.,
Ariz., and Ind.)
Included in the group was "Emily," age 56, who had situational
depression (treatment of depression with anti-depressants and/or
counseling for brief period due to life event such as death of a
family member, divorce, etc.)
In this study, "Emily" fared better than others and received offers
with no restrictions in all eight markets for an approximate $250
monthly premium.
Other applicants, with conditions ranging from asthma and allergies
to previous knee surgery and HIV positive status, encountered some
problems.
It should be noted that all applicants, excluding the HIV client,
received at least one offer in each market. However, the study showed
that about 90 percent of the time, the fictitious applicants were
unable to buy policies from individual insurers at standard rates,
while 37 percent of them were denied from the start. Of the 63 percent
who were accepted, 28 percent had benefit restrictions placed on
them.
What Are My Rights?
Only five states have laws that regulate individual health policies.
Maine, New Hampshire, New York, New Jersey, and Vermont guarantee
the consumer access to the individual market at community-rated
premiums not based on health status.
As for federal consumer protection, the Health Insurance Portability
and Accountability Act of 1996 (HIPPA) restricts insurers from excluding
pre-existing medical conditions from "group" coverage, but not "individual"
coverage.
Beginning in April 2003, doctors and hospitals can share patient
information with HMOs and insurance companies without a patientıs
permission, as long as these records are directly related to health
services.
This regulation has many privacy advocates concerned because it
sets aside a Clinton administration proposal that would have required
a patientıs written consent before such information could be released.
Just about the only way to be 100 percent sure who sees your personal
history is to seek the advice of a new physician and pay cash for
the visit and/or treatment.
Each year, about 20 percent of Americans experience anxiety, depression,
or other effects of mental illness. Nearly half donıt seek treatment
because of the stigma often associated with the disease and/or difficulty
paying for the treatment.
Spend some time surfing the net and youıll find many websites devoted
to this topic alone. But while the complaint is a common one, there
is no easy solution.
For example, one person wrote that she had been denied insurance
based on 1) other serious medical problems (she didnıt have any)
2) advised to undergo treatment in the last three years (she could
only assume they were referring to her prescription) and 3) depression
or anxiety. According to the writer, the only illness she had ever
had was when a doctor briefly put her on anti-depressants during
a time when she was dealing with four deaths and a divorce.
In response to her dilemma, she was told simply to continue applying
to insurance companies until she found one that evaluated her history
in a different manner. So how do the insurance companies find out
information about you that even YOU have forgotten by now? Itıs
easier than you think.
The MIB Knows
If you have ever applied as an individual for life, health or disability
coverage, chances are good that your name is listed in the database
of Medical Information Bureau (MIB). This company provides
information on more than 15 million Americans and Canadians to more
than 750 insurance companies. In exchange, the insurance companies
make sure that MIBıs information stays updated.
By sharing this information, the insurance companies donıt have
to call each other directly to follow up on applications. And MIB
says that itıs service helps fight fraud on the part of those consumers
applying for health coverage. Most of the information stays on MIB
for seven years. You can request a copy of your MIB file by logging
onto the Medical Information
Bureau's website.
Although consumers are supposed to be notified when someone is
checking MIBıs database about them, the information sometimes gets
overlooked in the fine print.
A word of advice: If you know of a medical condition that might
keep you from getting individual coverage, think very carefully
about applying for that particular kind of health insurance. Once
the database has a record of you being denied or rated up, you could
have a pretty rough time finding health, life or disability insurance.
Your MIB report will then register that you're a substandard risk.
And unlike court records which are sealed for juveniles at the
age of 18, children treated with antidepressants have this stay
on their MIB records. This leads many families who can afford it
to have their children and other family members treated at private
facilities.
Life Insurance
Health insurance companies arenıt the only ones interested in your
mental health. Those who provide life insurance are extremely interested.
For example, the insurance companies worry that if youıre depressed,
thereıs a greater risk of suicide. And after two years, most policies
are required to pay if someone takes their own life.
Life insurers, however, are much likelier to take more factors
into account. Someone who took an anti-depressant for a short time
because of a "reactive" or "situational" depression would not send
up a red flag like someone taking a daily maintenance dose.
What Can I Do
Remember that your MIB report only contains information forwarded
to the organization by insurance companies. Private treatment that
you've paid for yourself is not recorded by the MIB, and will not
affect your future insurability.
And always consider that even the hassle of finding individual
coverage is often worth it as opposed to going without coverage.
Just one accident can wipe you out financially. Contact your state
insurance department for more information about your private
insurance rights.
Links:
Medical Information
Bureau
National Association of
Insurance Commissioners
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This document is provided for information only; it is not intended
to diagnose symptoms, prescribe treatment, or to substitute for
consultation with a physician. While we have made every effort to
ensure that this information is accurate and extensive, only your
doctor can tell you if a medication, or drug combination, is safe
for you. Information intended for US residents only. |
