Pre-Existing Condition Insurance Plans

What is the Pre-Existing Condition Insurance Plan (PCIP)?

This is a new program created by the health care reform bill. It gives people who have a disease, condition or disability that prevents them from getting health insurance an option for coverage.

Does every state have this plan?

Yes, every state has a PCIP.

Does the federal government run them?

States can choose to set up and run their own plan or to give this role to the federal government.

Is there only one kind of plan?

The plans run by the federal government have three options – the Standard Plan, the Extended Plan, and the HSA Plan. These plans have different levels of premiums, deductibles, prescription deductibles and prescription co-pays. State run plans vary, as each state can design its own rules and coverage. However, the cap on out of pocket costs is the same for both federal and state plans.

Are the benefits the same across the country?

No. Benefits depend on whether the plan is federal or state run and, if state run, which state you look at.

With the federal plan, each of the three options provides preventive care (100%, with no deductible) when seeing an in-network doctor who makes a preventive diagnosis. There is a deductible for specialty care, hospitalization and prescriptions. After the deductible, there is a 20% co-pay for in-network medical costs. The maximum out-of-pocket expenses for covered services in a calendar year is $5,950 in-network/$7,000 out-of-network. There is no lifetime maximum or cap.

Who is eligible to participate in a PCIP?

Eligibility is the same for federal or state run plans. Applicants must:

  • Be a citizen or national of the United States or residing in the U.S. legally.
  • Have been uninsured for at least the last six months.
  • Have a pre-existing condition or have been denied coverage because of your health condition.

Different states may use different methods of determining whether an applicant has a pre-existing condition and whether s/has been denied insurance coverage. For example, some states guarantee coverage and in those states being offered coverage at an unreasonable price may be considered a form of coverage denial. Check out State Plans for more specific information.

Where may I find more specific information, including how to apply for a plan?

For general information orto find out whether the federal government runs the plan in your state go to: Pre-Existing Conditions Insurance Plan. This page will allow you to link to a range of information. If your state runs its own plan you can follow a link on the same page for details in specific states.

If the federal government runs the plan in your state you will need to provide a copy of one of the following documents with your application:

  • A denial letter from an insurance company licensed in your state for non-group insurance coverage (not offered through a job) dated within the past 12 months. Or, you may provide a letter dated in the past 6 months from an insurance agent or broker licensed in your state that shows you aren’t eligible for individual insurance coverage from one or more insurance companies because of your medical condition.
  • An offer of coverage from an insurance company licensed in your state for non-group insurance coverage (not offered through a job) dated within the past 12 months and including a rider that excludes an existing medical condition.
  • If you are under age 19 OR if you live in Massachusetts or Vermont, an offer of non-group insurance coverage (not offered through a job) from an insurance company licensed in your state dated within the past 12 monthsthat shows a monthly premium at least twice as much as the Pre-Existing Condition Plan premium for the Standard Option in your state. To find out if the premium you were offered is twice as much as the premium in the Pre-Existing Condition Insurance Plan for the Standard Option in your state, check out the State Plans page.

RxAssist, April 2011