Various state and federal regulations have been implemented over the years to limit medical underwriting formajor medical health insurance.
Medical underwriting can apply to an entire groupwhen employers apply for coverage for their employeesor to an individual person.
However, the insurer cannot consider the applicant’s medical history.
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This is a significant change brought about by the ACA.
Before 2014, individual market coverage could be purchased at any time.
That is no longer the case in any state.
Otherwise, a qualifying event is necessary to enroll or to disenroll.
What Is Considered a Small Group?
Most very large groupsand many medium-sized groupsopt toself-insurerather than purchase coverage from an insurer.
This has long been the case, due to HIPAA.
ACA regulations do not apply to excepted benefits.
Most excepted benefits are designed to supplement major medical coverage, rather than replace it.
And others enroll in health care sharing ministry plans.
They can and do use medical underwriting to determine an applicant’s eligibility to enroll.
Short-term plans are typically used as stand-alone coverage, but only for a limited period.
Short-term plans, unlike regular major medical plans, are not regulated by the ACA.
Medicare Advantageplans do not utilize medical underwriting.
But this changed in 2021, as a result of the 21st Century Cures Act.
And unlike Medigap plans, there is an annual open enrollment period for Medicare Advantage plans.
There are some guaranteed issue policies available, but they tend to have very low benefit amounts.
Prior to 2014, individual market insurers routinely used both.
Those plans, however, tended to have much stricter post-claims underwriting.
Medical underwriting is also still used when people apply for individual life or disability insurance.
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