Guaranteed Issue

Guaranteed issue laws require insurance companies to issue a health plan to any applicant – an individual or a group - regardless of the applicant's health status or other factors. Beginning January 1, 2014, all individual and group health plans must guarantee issue policies to all applicants, regardless of health status or other factors. For children under the age of 19, beginning September 23, 2010, issuers were prohibited from imposing preexisting condition exclusionary riders (i.e., an insurance company cannot refuse to pay for chemotherapy for a child with cancer because the child had the cancer before obtaining insurance) and outright coverage denials (i.e., an insurance company cannot refuse to issue a policy to the child because of the child's cancer). The ACA’s guaranteed issue provision applies to all group plans and new plans on the individual market, but does not apply to grandfathered individual plans. Prior to the enactment of the ACA, there were limited guaranteed issue provisions in the federal Health Insurance Portability and Accountability Act (HIPAA) of 1996. Under HIPAA, some insurance companies were required to guarantee issue policies to certain individuals, referred to as HIPAA-eligible individuals, regardless of their health status and disability. These individuals included people who had at least 18 months of prior coverage, the last day of which was under a group health plan. They cannot have more than a 63-day gap in coverage, and they must have exhausted any COBRA or state continuation coverage for which they were eligible. Such individuals must be guaranteed some type of coverage. States can decide whether that coverage should be available from private insurers or available in some other way (such as through the state's high risk pool). Although federal law requires that coverage be available, it does not limit how much insurance companies can charge HIPAA-eligible individuals for coverage. Without a limitation by the states, this coverage can be very expensive.