When do individual health insurers have to sell me an individual insurance policy?

In Arizona, your ability to buy individual health coverage may depend on your health status. There are certain circumstances, however, when you must be allowed to buy individual health insurance.

• In general, insurers that sell individual health insurance in Arizona are free to turn you down because of your health status and other factors. When applying for individual health insurance, you may be asked questions about health conditions you have now or had in the past. Depending on your health status, insurers might refuse to sell you coverage or offer to sell you a policy that has special limitations on what it covers.
• If you are HIPAA eligible, all insurance companies that sell individual health insurance must offer you a choice of at least two plans. Insurers must offer you at least two policies, whose benefits must be similar to those sold to everyone else buying individual health insurance. Companies that do not designate two policies must offer you a choice of all of their individual insurance products.

To be HIPAA eligible, you must meet certain criteria

No matter where you live in the U.S., if you are HIPAA eligible you are guaranteed the right to buy individual coverage of some kind with no pre-existing condition exclusion periods. To be HIPAA eligible, you must meet all of the following:

• You must have had 18 months of continuous creditable coverage, at least the last day of which was under a group health plan.
• You also must have used up any COBRA continuation coverage for which you were eligible.
• You must not be eligible for Medicare, Medicaid or a group health plan.
• You must not have health insurance. (Note, however, if you know your group coverage is about to end, you can apply for coverage for which you will be HIPAA eligible.)
• You must apply for health insurance for which you are HIPAA eligible within 63 days of losing your prior coverage.

HIPAA eligibility ends when you enroll in individual health insurance, because the last day of your continuous health coverage must have been in a group plan. You can become HIPAA eligible again by maintaining continuous coverage and rejoining a group health plan.

• Under Arizona law, newborns, adopted children and children placed for adoption are automatically covered under the parents’ health plan for the first 31 days, if the plan covers dependents. The insurer may require that the parent enroll the dependent within the 31 days in order to continue coverage beyond the 31 days.
• If you have a disabled child, that child may remain covered under your individual health insurance policy after he or she reaches the age at which dependent coverage is usually terminated.  To qualify, your adult son or daughter must be incapable of self-support because of developmental disability or physical handicap and must be chiefly dependent on the policyholder for support.  Proof of incapacity must be furnished within 31 days of reaching the time limit and may be required periodically thereafter.

What will my individual health insurance cover?

• It depends on what you buy. Arizona does not require health insurers in the individual market to sell standardized policies. Health plans can design different policies and you will have to read and compare them carefully. However, Arizona does require all health insuraers to cover certain benefits – for example, diabetes treatment and mammograms. Check with the Arizona Department of Insurance for more information about mandated benefits.

What about coverage for my pre-existing condition?

• If you are HIPAA eligible and purchasing a guaranteed issue individual health insurance policy, a pre-existing condition exclusion period cannot be applied. 
• Individual health insurers can impose elimination riders. This is an amendment to your health insurance policy that permanently excludes coverage for a health condition or even an entire body part or system.  Elimination riders cannot be applied to HIPAA eligible individuals.
• Arizona insurers can also impose pre-existing condition exclusion periods. In Arizona, there are no limits on how long an individual health insurer can exclude a preexisting condition.  This means that individual health insurers can decide themselves how long to exclude your pre-existing condition.

  In addition, in Arizona, individual health insurers have broad discretion to define what constitutes a pre-existing condition, even including an undiagnosed condition you may unknowingly have had when you applied for the policy.  If you make a claim for a health condition after you buy a policy, it may be denied if the insurer decides the condition was pre-existing. In Arizona, individual health insurers can consider pregnancy a pre-existing condition.  Genetic information cannot be considered a pre-existing condition.

• If you make a claim during the first two years of coverage, the insurer can look back to see if the claim is for a condition that would have been considered a pre-existing condition.  If the insurer determines that the condition is a pre-existing condition, it can refuse to pay for expenses for that condition.
• Individual health insurers do not have to give credit for your prior coverage, unlike group health plans in Arizona.

What can I be charged for my individual heath insurance?

• In Arizona, there are no limits on what you can be charged for individual health insurance. You can be charged substantially higher premiums because of your health status, age, gender, and other factors. So if you have an expensive health condition, your individual health insurance premiums may be very high.

  If you have questions about your premiums, contact the Arizona Department of Insurance.

Can my individual health insurance policy be cancelled?

• Your coverage cannot be canceled because you get sick. This is called guaranteed renewability. You have this protection provided that you pay the premiums, do not defraud the company, and, in the case of managed care plans, continue to live in the plan service area.
• Your health insurance policy may be canceled if the insurer discontinues your health policy or withdraws from the individual market.

  Call the Arizona Department of Insurance if you have questions about an insurance company or the renewability of individual health insurance.

• Some insurance companies sell temporary health insurance policies. Temporary policies are not guaranteed renewable. They will only cover you for a limited time, such as six months. If you want to renew coverage under a short-term policy after it expires you will have to reapply and there is no guarantee that coverage will be re-issued at all or at the same price.