Health Insurance and the "Letter of Creditable Coverage".

[Snarkoleptic]

Most people who don't work in the insurance or "health coverage denial" industry have never heard of a "Letter of Creditable Coverage". Well, I'm here to tell you that this is a major mechanism by which the health insurance scoundrels limit their risk through the exclusion of pre-existing conditions.

My wife of 19-years had a 'little touch of cancer' back in late-2002 (fortunately she's had no recurrence). At the time, we had very solid health coverage and all seemed right with the world. Flash forward to early 2007 when I was laid off. Suddenly I'm paying $1,380/ month in COBRA and looking for options. After a few months, we were no longer able to bear this financial burden and sought cheaper "catrastophic only"-type coverage with a $7,500 deductible.

For 2-years we had what I called "swiss cheese" insurance which had more gaps and exclusions than actual coverage. Our finances began to improve slighly after I took a position with a company who paid a modest salary but offered no benefits. We again sought real coverage, but were rejected by the first carrier that we approached due to her medical history. The second carrier accepted us, but stated that nothing related to her prior health issues would be covered. We found this to be unacceptable, so we (unwisely) lapsed our health insurance for about 45-days while we continued to bleed cash and seek a solution to this problem.

Until this time, we'd had health insurance for 17-straight years with not so much as a minutes lapse in coverage. Now that we were on the ropes and needed coverage, we were considered "damaged goods" due to a lapse in coverage. We obtained insurance after the 45-day gap, but now had to go back to each of the insurance carriers we've had coverage with over that past 3-years and get a "Letter of Creditable Coverage". The letter states who was covered as well as the exact start and stop dates of the coverage.

Long story made short...
After having health insurance for all but 45-days of our adult lives, she's no longer got coverage relating to her prior health issues.

This system is so convoluted and twisted to screw the consumer that I'm convinced ANY form of for-profit health care must be abolished. </rant off>

[KatyMan]

1. I know what you mean

We lived for 3 years in the UK, and when we moved back, our daughter couldn't get coverage becuase she didn't have US based insurance for the previous 6 months. What in the world does that have to do with anything? Nevermind that she was on teh NHS, got her meds free (she has epilepsy), and was well cared for. It's such a scam and it's a shame our republican't 'friends' can't see that.

[Snarkoleptic]

2. It's a classic case of you can't get it becuase you don't have it.

This system is broken must be fixed.
The profit motive is pure evil...how can someone profit from denying someone else health?

[Warren DeMontague]

3. The irony is that it's the idiots standing outside screaming "socialism" that are so mad.

It should be the rest of us.

I'm sorry about your situation, even sorrier that it's repeated tens of millions of times across this great land.

[slipslidingaway]

4. Thanks and kicking for more info....

just a quick search shows some confusion???

http://answers.yahoo.com/question/index?qid=20070811150351AAI4hUv

"To reiterate what the others have said, a letter of creditable coverage is similar to your HIPAA certificate. It shows that you have had previous insurance coverage, which saves you from having to met pre-existing condition time periods..."


http://wiki.answers.com/Q/Certificate_of_Creditable_Coverage

"Assuming you want to know what is a "Certificate of Credible Coverage" - this is a document provided to you by an insuracne company after you drop their coverage provided the coverage was a HIPAA qualified plan. Most company plans are HIPAA qualified. Here is why they send it to you.

Under HIPAA regs if you move from one plan to another and have a break in coverage of less than 63 days then the new carrier can NOT impose a pre-existing conditions clause. So if you had MS and moved from job A to job B with less than a 63 day lapse in coverage and had your Certificate, the insurance carrier for job B would have to cover that condition day 1."

[iamjoy]

5. I'd Not Sure HIPAA Applies

I think the HIPAA regulations regarding limitations on pre-existing conditions only apply to group health plans - such as through an employer. If Snarkoleptic is seeking a private or individual policy, he may be screwed. Of course, I am not a lawyer - I work in HR Benefits Consulting, so my view is narrow. I know our plans don't exclude - in part due to HIPAA, but I don't know if the same guidelines apply to non-group policies.

Another indication our health care system is sick

[slipslidingaway]

6. Your answer makes sense as the second reply I posted speaks

of moving from job A to job B and that could mean group coverage.

Thanks.

:)

[Snarkoleptic]

7. I beleive you are correct about the group coverage assumption.

Also, I forgot to mention that my insurance broker (who has been in the biz for 25-years) told me to chase down multiple letters of "credible coverage". I now wonder if this "creditable coverage" scheme is a new angle the insurance companies are working.
My broker is not the sharpest tack in the box, but he had all of the other health insurance lingo down pat.

[slipslidingaway]

8. Thanks to iamjoy for the additional information, I had never heard

of this before and was curious.

Insurance companies exist to make a profit for investors...that is their sole purpose.

They add nothing of value and need to be relegating to selling only supplemental policies for non essential health care.

Great two minute video on the role of insurance companies...

CNN IReport on No Need For Insurance Companies
http://www.youtube.com/watch?v=IoPjExTu-dM

Sorry this is happening to your family, I wish we would join the rest of the industrialized nations and take the profit motive out of health care.