Pre-Existing Condition Insurance Plan

Pre-Existing Condition Insurance Plan

The Department of Health and Human Services and the government have put into effect a new plan where people with pre-existing conditions will now be eligible for health insurance. This new plan will provide insurance to millions that are currently uninsured, and is just one of many changes of President Obama's new health care reform. Premiums will also be lowered up to 40% in some areas.


This plan, called the Pre-Existing Condition Insurance Plan (PCIP), will provide health insurance for those who have been without coverage for at least 6 months because of a pre-existing condition such as diabetes or heart disease. This plan came into force during the summer of 2010 as one of the first parts of President Barack Obama's new health care reform that was put into effect in March of the same year.

About 20,000 Americans have signed up for the PCIP, but officials still remain optimistic that this program will help hundreds of thousands of people before it is phased out. The new program has not been advertised very much, and it is said that insurance brokers will get a bonus for clients that they refer to this program. The program will be phased out in 2014, when it will no longer be legal for insurance companies to deny coverage to those with pre-existing conditions.

The Health and Human Services (HHS) runs this program in certain states and in those states the monthly premiums will be significantly lowered with effect from July 2011. This is done so as to spread the word about this new program. In Florida and Alabama, though the amount varies, the rates could be 40%. In Virginia, people above the age of 55 will have to pay only $297 a month, instead of the previous $498. To qualify for the program, all they will need is a note from a doctor, instead of the formerly required rejection letters from other insurance companies.

In states where the federal government is overseeing the program, the HHS mentioned that they will issue a letter to these states asking them to offer a decreased premium rates as the HHS has done.

There are more than 250 million people who are not covered by insurance companies due to pre-existing conditions. People whose medical needs are crucial feel that the 6 month insurance-free requirement is not a good condition. Unfortunately this condition is written in the statute and hence cannot be changed. While this may discourage some people from participating, many others will agree that some sort of waiting period is better than not having any coverage at all.

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