Health Insurance Articles
Can A Health Insurance Company Deny Employees Coverage In A Group Health Plan
2010-01-08
To be certain, health insurance is the hot button issue of 2010. President Obama promised Americans sweeping health care reform as a candidate, and the U.S. Senate and House of Representatives have doggedly pursued their party's version of what will ultimately be best for the country. But while we wait, health insurance is a concern for all of us.
Group health insurance coverage is the most common form of health insurance coverage for working Americans. Many of us seek employment based on an interest in employer provided health insurance. But what happens if a health insurance provider denies coverage to an employee under a group plan? Can a health insurance company even do that? In the midst of all of the proposed changes in our health care system, the simple answer is yes. Under certain circumstances, coverage can legally be denied. The Health Insurance Portability and Accountability Act of 1996 (HIPAA) is a federal law. The law limits the ability of a new employer plan to exclude coverage for a preexisting condition. HIPAA guards against discrimination for health factors of individuals and their family members and ensures that individuals will have access to and can renew their individual health insurance policies. However, some states have health insurance laws that compliment HIPAA making it possible for an insurance company to deny coverage. Therefore, the ability for insurance companies to do so is more decided on the state level.
As protective as insurance laws can be, individuals may still be denied coverage for preexisting conditions if their condition reoccurs within the exclusion period of enrolling in a group plan. In addition, if an individual surpasses the lifetime limit on benefits provided under the plan, he or she may be denied coverage. Under HIPAA, a group health plan may apply lifetime limits for a specific disease or treatment. Under Federal law, a plan can also deny benefits based on the source of an injury. In the case of an injury that is not the result of medical condition or domestic violence, an insurance company can deny benefits. Under such circumstances the insurance company could determine that the injury was caused by the employee or insured acting in a manner that neglects his or her well-being. For example, if you want to bungee jump off of a tall building, don't expect your company group health insurance to cover your broken neck.
For the most part, the state laws in tandem with HIPAA do a fairly good job of protecting American workers. They make it so that the circumstances under which they might be denied benefit under their group health insurance plans are rare and extreme.
