I Have a Pre-Existing Condition—Do I Need to Worry About Trump's Plan?

couple confused by insurance

The future of the Affordable Care Act and healthcare reform are uncertain now that the Trump Administration is in place. President Trump campaigned heavily on the promise that he would repeal Obamacare and start from scratch. He has since moderated his stance somewhat, stating that he'd like to keep some aspects of the ACA in place, including the requirement that health plans cover pre-existing conditions and accept applicants regardless of their medical history.

But one of his first acts as President was to issue an executive order directing government agencies to be as lenient as possible (within the confines of existing law) in enforcing the ACA's penalties and taxes.

The AHCA and Pre-Existing Conditions

In March 2017, House Republicans introduced the American Health Care Act (AHCA). The AHCA is was the result of January's budget resolution that instructed Congressional committees to draft reconciliation legislation to repeal spending-related aspects of the ACA (things like subsidies, Medicaid expansion, the individual and employer mandates).

Reconciliation bills are filibuster-proof, so they only need a simple majority in the Senate. But they are limited to provisions that directly impact federal spending, and therefore cannot address all aspects of the Affordable Care Act. So while the AHCA repeals and/or changes the ACA's taxes, subsidies, and Medicaid expansion, it does not change the requirement that plans cover pre-existing conditions.

House Speaker Paul Ryan (R, Wisconsin), has explained that the AHCA is only the first phase of a three-phase plan that GOP leadership hopes to implement. The third phase would be focused on additional legislation that would address non-spending-related provisions (and would thus be subject to filibuster in the Senate, so it would need 60 votes).

Although it's possible that changes to the rules for pre-existing conditions could be addressed in such legislation, GOP lawmakers have been touting the fact that the AHCA maintains protections for people with pre-existing conditions, making it unlikely that they'll try to dismantle that provision. 

The AHCA would repeal the ACA's individual mandate penalty back to the beginning of 2016, removing one of the incentives that currently keeps healthy people in the insurance pool (insurance only works if there are enough healthy people in the pool to balance out the claims of people who need health care). But coverage would still be guaranteed-issue, regardless of an applicant's medical history.

In order to incentivize people to maintain coverage, the AHCA would instead rely on a premium surcharge for people who don't maintain continuous coverage. For enrollments after the 2018 open enrollment period (ie, anyone enrolling during a special enrollment period in 2018, or during the open enrollment periods for 2019 and beyond), applicants would be assessed premiums 30 percent higher than the standard rate if they had a gap in coverage of 63 days or longer during the 12 months prior to enrolling.

The higher premiums would remain in place for the remainder of the plan year.

It's important to note that the higher premiums would apply to anyone enrolling in an individual market policy following a gap in coverage. It wouldn't matter whether the applicant was healthy or sick. In a way, this essentially discourages healthy people from enrolling after a gap in coverage, and could further tilt insurance pools towards sicker enrollees. 

The AHCA is very much up in the air as of mid-March 2017. Senator Susan Collins (R, Maine) has said that she will not vote for it in its current form, and it's doubtful whether Republicans will be able to muster 50 votes in the Senate without significant changes to the bill (50 votes would result in a tie, but Vice President Pence could cast the tie-breaking vote).

What to Expect for 2017

Nothing is changing in terms of 2017 coverage, regardless of whether the AHCA passes or not. If the legislation passes and the individual mandate penalty is retroactively eliminated, the Congressional Budget Office projects that 4 million people would drop their coverage for 2017, mid-year. 

That could exacerbate the current uncertainty facing the individual insurance market, resulting in significantly higher premiums and fewer available plans for 2018. But plans that remain available would have to continue to provide coverage for pre-existing conditions, and would not be able to discriminate against applicants based on their medical history.

What If the AHCA Doesn't Pass and the GOP Tries Something Else?

Recent Kaiser Family Foundation data indicates that 27 percent of non-elderly adults in the U.S. have pre-existing conditions that would make them uninsurable in the individual market if we returned to the medical underwriting standards that were in place in nearly every state prior to 2014.

Although the AHCA is currently under consideration in Congress, there's no guarantee that it will pass; Republican lawmakers may have to go back to the drawing board. And even if it does pass, we don't yet know exactly what will be in the third phase of House leaders' overall plan.

But even if the ACA's pre-existing condition protections were to be eliminated, most Americans would still be protected, thanks to rules that pre-date the ACA. Let's take a look at how they work:

Pre-ACA: Rules Varied Based on Type of Insurance

There are four main ways that Americans get health insurance: Employer-sponsored coverage, Medicare, Medicaid, and the individual market. You can expect different things for each of them under the Trump Administration.

If the ACA's pre-existing condition protections were to be repealed, the impact would not be uniform across those four groups. The primary changes wrought by the ACA in terms of pre-existing conditions were in the individual market, where about 7 percent of the U.S. population gets their health insurance.

HIPAA Would Still Protect Group Plan Enrollees

HIPAA (the Health Insurance Portability and Accountability Act) dates back to the mid-90s, and has long provided significant protection for people who obtain coverage from an employer (about 49 percent of the U.S. population has employer-sponsored coverage). Even full repeal of the ACA—as opposed to a reconciliation bill like the AHCA—would not eliminate HIPAA provisions, so people who get coverage from their employers would still have coverage for pre-existing conditions.

But prior to the ACA, under HIPAA regulations, employer-sponsored plans could impose waiting periods for pre-existing condition coverage (except maternity, assuming the plan provided maternity benefits) if the enrollee had not maintained continuous coverage prior to enrolling in the plan.

As long as the person had maintained continuous coverage for at least 12 months without a gap of 63 days or more, pre-existing conditions were covered as soon as the overall coverage became effective. But if the enrollee had a gap in coverage of more than 63 days prior to enrolling in the employer-sponsored plan, the plan could impose a waiting period of up to 12 months for pre-existing conditions.

The ACA eliminated that provision. Under the ACA, pre-existing conditions are covered on every employer-sponsored plan, and on all non-grandfathered (and non-grandmothered) individual market plans, as soon as the person's coverage under the plan takes effect.

The ACA also prohibited insurers from charging small groups extra premiums based on their employees' medical history. Small group coverage was already guaranteed-issue under HIPAA, but carriers could charge higher premiums to groups with poorer overall health. Once the ACA took effect, this was banned, and small group premiums could only be based on enrollees' ages, geographic location, family size, and tobacco use.

If the ACA were repealed and a replacement didn't include a provision banning waiting periods for pre-existing conditions, the rules would revert to the way they were prior to 2014. People who maintained continuous coverage would have no waiting periods for pre-existing conditions when joining an employer's health plan. But people with a gap in coverage would potentially be subject to waiting periods for pre-existing conditions. And small groups with employees in poor health could face higher overall premiums than small groups with healthy employees.

But the AHCA does not eliminate those ACA provisions (keeping in mind that it's a reconciliation bill, and is thus limited in terms of what it can change). Under the AHCA, the ban on pre-existing condition waiting periods for employer-sponsored plans would remain in effect, and pemiums would not be dependent on the health status of the employer group.

Medicare and Medicaid Would Still Cover Pre-Existing Conditions

Medicaid and Medicare cover pre-existing conditions. There are some caveats with Medicare, however, which do not have anything to do with the ACA:

  • In most states, people enrolling in a Medigap plan after their initial enrollment window (and without access to one of the very limited Medigap special enrollment periods) are subject to medical underwriting. Their applications can be denied, they can be offered a plan with a higher-than-standard premium, or the carrier can impose a pre-existing condition waiting period.  
  • In most cases, if you have end-stage renal disease (ESRD), you cannot enroll in Medicare Advantage

Although the ACA didn't change anything about pre-existing condition coverage under Medicare and Medicaid, it did substantially expand access to Medicaid. Total enrollment in Medicaid/CHIP has increased by nearly 17 million people since the end of 2013, thanks in large part to the ACA's expansion of the eligibility rules for Medicaid.

Prior to the ACA, Medicaid (which included coverage for pre-existing conditions) was available in most states only for low-income pregnant women and children, some very low-income parents, along with low-income residents who were disabled and/or elderly.

Under the ACA, 31 states and the District of Columbia have expanded Medicaid to all adults with household income up to 138 percent of the poverty level, which is a little more than $16,000 in annual income for a single person. 

If the ACA is repealed and the replacement isn't as robust, millions of people who currently have Medicaid could lose realistic access to coverage. They would be able to purchase coverage in the individual market (likely with some type of tax subsidy), but that might not be financially feasible for those with the lowest incomes. If they were to become uninsured, their pre-existing conditions would no longer be covered, nor would any unforeseen medical care they might need.

The AHCA calls for freezing enrollment in expanded Medicaid as of 2020, and switching Medicaid to a per-capita allotment rather than the current open-ended federal matching system used today. 

Pre-Existing Conditions Could Become a Problem Again in the Individual Market

While the AHCA does not eliminate any of the ACA's pre-existing condition protections, it may not be the law that's ultimately enacted. And if it is, we don't yet know what's coming in later phases. Understanding how pre-existing conditions were handled pre-ACA is an important part of understanding why the ACA was necessary in the first place, and what's at stake if the pre-existing condition protections are altered.

Coverage in the individual market in all but five states was medically underwritten prior to 2014, when the ACA banned that practice (individual market coverage is the kind you buy for yourself—through the exchange or off-exchange—rather than obtaining it from an employer).

There are more than 20 million people who have coverage in the individual market. Many of them already had individual market coverage pre-ACA, but some were only able to obtain coverage when the ACA's rules took effect and carriers were no longer able to deny applications based on applicants' medical history. 

Medical underwriting meant that individual market health insurance applications included long lists of questions about applicants' medical history. Coverage eligibility depended on the answers, and for people who were allowed to enroll despite their pre-existing conditions, premiums were often higher than the standard rates.

Pre-existing conditions included basically any medical diagnosis. Being overweight, having elevated cholesterol or blood pressure, a history of visits to the chiropractor... everything was analyzed by medical underwriters to determine whether the applicant was eligible for coverage, and if so, at what price.

The ACA changed all that. For the individual market, the ACA's pre-existing condition rules were a game-changer. Rejected applications and increased premiums due to medical history became a thing of the past, as did pre-existing condition waiting periods. 

In addition to the AHCA, several other pieces of ACA repeal/replace legislation have been introduced by GOP lawmakers in the 2017 session. Many of them, including the AHCA, call for retaining the ACA's current protections for people with pre-existing conditions.

But if the ACA's guaranteed issue requirements are not retained, there are two main avenues for covering pre-existing conditions that have been included in most of the proposals put forth over the last few years: high-risk pools or a "continuous coverage" requirement, or both.

Both are included in the Empowering Patients First Act, introduced by Rep. Tom Price (R, Georgia), who was confirmed by the Senate in February 2017 to be the Secretary of Health and Human Services. Both are also included in A Better Way, the healthcare reform proposal put forth by House Republicans in June 2016.   

High-Risk Pools

Most of the Republican proposals also include a return to high-risk pools for insuring people who aren't able to obtain coverage in the individual market (in proposals that include continuous coverage provisions, high-risk pools would be needed to insure people who don't maintain continuous coverage, and whose pre-existing conditions are significant enough that they're not able to obtain medically underwritten coverage).

High-risk pools were established in 35 states during the 90s and 00s. But the overall shortcomings of the high-risk pool model were part of the reason the ACA was needed in the first place. The plans tended to be expensive, and typically had high out-of-pocket exposure and limited lifetime maximum benefits. In addition, some high-risk pools had to limit enrollment over the years due to budget constraints.

High-risk pools mostly ceased operation when guaranteed-issue individual market coverage became available in 2014. But some states still have functional high-risk pools. With adequate federal funding, high-risk pools could be a viable solution going forward. But without adequate funding, it's unlikely that they'd be any more successful than they were in the years leading up to the implementation of the ACA.

Continuous Coverage

Under the ACA, coverage is guaranteed issue, period. It doesn't matter how long you've been uninsured when you enroll, and it doesn't matter what pre-existing conditions you have.

Under the various GOP replacement proposals that call for continuous coverage, the idea is to basically extend some of HIPAA's protections to the individual market. People who maintain continuous coverage (either in a group plan or an individual plan) would be able to enroll in a new plan at the standard premium, regardless of pre-existing conditions (ie, with no medical underwriting).

But people who experience a gap in coverage would be subject to medical underwriting. The idea is to incentivise people to maintain continuous coverage without resorting to the ACA's unpopular individual mandate.  

Although the AHCA does include a premium surcharge for people who don't maintain continuous coverage, it doesn't include medical underwriting. The additional premiums would apply uniformly, to both healthy and sick applicants. This is different from a continuous coverage provision that would allow insurers to use medical underwriting when applicants enroll following a gap in coverage.

Do I Need to Worry?

For the time being, probably not. The main bill being debated, the AHCA, doesn't change anything about pre-existing condition protections. However, the fact that it eliminates the individual mandate means that healthy people might drop their coverage, driving up premiums for people who remain insured (including those with pre-existing conditions).

For the time being, nothing has changed. If you've already enrolled in coverage for 2017, it will still be effective (and covering pre-existing conditions) even if Congressional Republicans ultimately pass legislation to repeal portions of the ACA during the 2017 legislative session. And Medicaid expansion will remain in place throughout the year, as proposed changes (including those called for in the AHCA) wouldn't take effect until a few years down the road.

Republican lawmakers are currently emphasizing the fact that their proposed legislative reforms would not touch the ACA's protections for people with pre-existing conditions. But this debate is far from over, and the pre-existing condition issue is still certainly something to watch.


Congressional Budget Office, American Health Care Act, March 13, 2017.

HealthCare.gov, Grandfathered Health Insurance Plans.

Kaiser Family Foundation, Health Insurance Coverage of the Total Population. 2015.

Kaiser Family Foundation, Pre-existing Conditions and Medical Underwriting in the Individual Insurance Market Prior to the ACA. December 12, 2016.

United States Department of Labor, Health Benefits Coverage Under Federal Law. September 2014.

United States Department of Labor, Health Insurance Portability and Accountability Act (HIPAA) Portability Of Health Coverage And Nondiscrimination Requirements FAQs.

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