10 Reasons You Could Be Denied For Health Insurance

The recent passage of the Affordable Care Act, also known as Obamacare, has ensured that Americans cannot be denied health insurance for pre-existing conditions. However, there are still many reasons that people can be denied health insurance coverage. There is even an exception to the rule that Americans cannot be denied for pre-existing conditions. This article will provide information about ten reasons that an application for health insurance may be denied. Those planning to apply for health insurance would be smart to educate themselves as much as possible about the current health insurance situation. To learn more about health insurance denials, read on.

Yearly Income May Be Above Allowed Levels

Those applying for certain government-administered health insurance plans like Medicare or Medicaid can be rejected if their income is above a certain level. How much income Americans can have and still qualify for these plans depends on some different factors. There is a sliding scale that increases or decreases depending on how many children are in the family. For example, a family that has three children can earn more money and still qualify for medical care, over a family with one child. The base numbers on the scale change year to year, so families are advised to check this information on a regular basis.

Eligibility For Coverage Through a Spouse

Those that are trying to obtain a subsidized health insurance plan through the government-sponsored health insurance marketplace may be ineligible if their spouse has a plan that can cover them. This does not mean that these applicants cannot get any of the plans listed on the health insurance exchange, it simply means that they are not eligible for government subsidy. Thus, they can be rejected if they apply through the health insurance marketplace for such plans. If those individuals go outside of the marketplace, they will not be rejected due to their spouse’s plan. Of course, plans purchased outside of the marketplace will be much more expensive.

Kids May Be Able To Get On Their Parent's Insurance

Certain states sponsor a health insurance program for children born into low income families. The eligibility criteria for these plans differs from state-to-state as not every state has similar plans for children. People wondering whether or not their state has a government-sponsored plan for children should check the state health department website. Many of these plans will not cover a dependant if they are eligible for coverage under their parent's plan. Some states will still allow a dependant to be coverage through the government plan, even if the parent has a plan that can cover them. In this case, the family must earn less than a certain dollar amount per year.

Applicants With Risky Careers May Be Denied

Working in a risky or hazardous career field is one little-known reason certain individuals are denied health insurance. The number of occupations that are considered hazardous enough by an insurer to deny an applicant outright are fairly small, so many do not know about this practice. Firefighters and police officers may be denied appropriate coverage if they try to get another plan, other than the one offered with their position. Most in this situation are offered a fair plan through their job, and so are fortunately not greatly inconvenienced.

Non-Payment Of Premiums From A Previous Policy

Some applicants are denied due to non-payment of premiums from a previous health insurance plan. This case is especially true if they have had a previous policy canceled due to non-payment and they are applying for a new one with the same insurer.Those in this situation should apply through a different insurance company, as they will have a better chance of getting accepted. However, their acceptance is not guaranteed. Some insurance companies will research and find out if there are any collections accounts due to the non-payment of health insurance premiums, and may deny an applicant based on this criteria.

False Information On A Previous Tax Return

Another reason applicants are denied for a government-sponsored health insurance plan is false information on their previous tax return. This reason may apply to people who are applying for Medicare, Medicaid, or plans from the health insurance marketplace. In the past, some applicants falsified their tax returns, so they choose to apply for a government subsidy on a plan from the health insurance marketplace so they qualify for Medicare or Medicaid. Those who are caught doing this may face a penalty, or are banned from applying for a government plan for the rest of their life.

A History Of Risky Behavior

Applicants with a history of medically risky behavior, such as smoking or drinking, may be denied health insurance. Smoking and drinking are not considered to be pre-existing conditions, and as such are not covered under the provision of Obamacare that prevents insurers from denying someone due to a pre-existing condition. An applicant with lung cancer as a result of smoking or cirrhosis from drinking cannot be denied based on their medical conditions, but they could be denied based on their behavior. Some health insurance advocates have made the case that people should not be denied for risky behaviors, but this is not currently the applicable law.

COBRA Coverage Can Be Denied For Termination

COBRA coverage refers to the continuation of health insurance benefits after an employee has been laid off from a job. Former employees who were fired or chose to quit are usually not eligible for COBRA. Someone applying for COBRA coverage after they have been terminated may see their application denied. However, there are exceptions. For instance, if the applicant has been wrongfully terminated, they could be able for COBRA coverage, but they will likely have to prove that the firing was wrongful in a court of law.

Incorrect Information On The Application

Insurers are allowed to deny an application based on incorrect information. An insurer will usually do a background check as well as look into medical records to ensure that the applicant isn't falsifying information on their application. Insurers in most states are legally allowed to deny an applicant solely based on any incorrect information found on their forms. However, in California, insurers are only allowed to deny someone based on wrong information that could affect medical care. For example, if someone with hazel eyes puts their eye color down as green, the insurer cannot deny their application on this basis.

A Grandfathered Plan Can Deny Coverage Based On Pre-Existing Conditions

A plan purchased in America before March 2010 is grandfathered in under the Affordable Care Act. That is, someone can still be denied for a renewal of this plan if they have a pre-existing condition. Any new conditions will usually result in a rise in the premiums, not a denial. Americans have been denied renewals from grandfathered plans; if these people wanted to apply for a new plan, they could not be denied based on pre-existing conditions. However, their premiums will likely be much higher under their new insurance plan.