The Private Health Insurance BoogeyMan: Underwriting and Approval Process
Hey all, following up on another post. Friendly reminder this is not a solicitation post, as I am a broker on both ACA and private plans.
My goal is to clear up some confusion that I see all over this subreddit about private plans, otherwise I wouldn’t feel the need to post.
Final disclaimer- this is not about short term, discount, medshare, or other unregulated products. I am talking about “non-ACA compliant” regulated private market coverage with traditional deductibles, max out of pockets, etc.
Private health insurance, or non-ACA compliant plans, will require you to go through medical underwriting of some sort.
Underwriting for health insurance just means your medical history will be checked before you can be approved on a coverage plan. While every carrier is different, two things are usually checked:
1) Prescription refills last 12 months 2) Hospitalizations in last 5-10 years
ACA compliant plans do not have this hurdle, which is why most brokers point those with strong pre-existing medical conditions towards that side of the market (or those that can qualify for premium assistance).
Since you have to jump through some hoops to be approved on private coverage, the coverage and pricing is universally better than full price ACA. Rate-locked to age 65, full preventative care, PPO, etc
How do you go through underwriting? First, your broker will submit an application on your behalf. Then, the insurance carrier will verify the information with a medical record check at your facility + phone call with you directly.
If there are discrepancies or concerns, the carrier will either ask for more information or approve you with a higher premium. If you are denied, that’s that for the specific carrier.
Age is not factored in to your risk assessment, only your base premiums. I have healthy 60+ year olds approved all the time.
Every carrier and product is different with approval requirements. A good broker will help you apply to multiple options to see who comes back with the best deal.
Final food for thought: Even if you are unhealthy, most carriers will allow you to be approved if you opt to forego surgical benefits for preexisting conditions for the first year only.
Let’s say you had a knee replacement last month, and you’re surgically cleared. From the carriers perspective, you are an active risk and will be denied.
If you know you won’t need another knee surgery for the first year of coverage, and have no other risk concerns present, then you can play the preexisting clause card and all parties win.
Hopefully this helps! Again, I am not a private market captive agent, over 60% of my clients are on ACA. The other 40% are extremely happy with what they didn’t realize they had access to.
submitted by /u/Health-Inusrance
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