Automatic Coverage Gap for Newborns?

[dgoldenz]

So what happens if the baby was a premie? 2 weeks of that care could create quite the bill.

Sucks for you, or sucks for the insurance company.

I don't see how they can require retroactive effective date if someone has no prior coverage, but it's also unfair for there to be a coverage gap. Then they are forcing some random insurance company to foot 100% of the bill, which could be up to ~$1,000,000 for a premie that's in ICU for a few weeks?

Has anyone actually come across a situation like this and enrolled someone yet?

 

[RayNY]

It doesn't matter when the baby should be born, all that matters is that once it's out of the womb it's eligible for healthcare starting that day. Early, late, or on time it makes no difference.

Yes, the insurance company may be on the hook for a big bill. A big bill incurred during a time period they received premium to cover the risk. They ALWAYS can be on the hook for a big bill, that's why insurance exists...

It's not unfair, especially when you consider how many people are going to be owing back premium for their forced retro effective dates that had no claims. Theoretically, the risk pool doesn't change. We'll see the reality in a few years, this one is going to be very hard to measure the effect of.

 

[Ann H]

Sucks for you, or sucks for the insurance company.

I don't see how they can require retroactive effective date if someone has no prior coverage, but it's also unfair for there to be a coverage gap. Then they are forcing some random insurance company to foot 100% of the bill, which could be up to ~$1,000,000 for a premie that's in ICU for a few weeks?

Has anyone actually come across a situation like this and enrolled someone yet?

You brought up an interesting point, DS4. If the parents were previously insured, then adding the baby from moment of birth is sensible. We do that all the time. The premium charged for adults in child-bearing ages includes a premium for this risk. The premium for maternity coverage includes a charge for this risk. So, the insurance company has been collecting a premium all along, and when they are handed the claim it's simply part of the risk.

However.... if both parents were previously uninsured, then are allowed an SEP simply because they gave birth, some insurance company is handed a claim. A pregnant woman could game the system easily.

I realize this is the wild west of SEP season, but some of the SEPs that the exchange is allowing are just plain nutty. From the emails we are receiving from carriers, it appears that carriers understand the parameters under which a person should get an SEP, but the exchange is running their own rodeo.

 

[RayNY]

However.... if both parents were previously uninsured, then are allowed an SEP simply because they gave birth, some insurance company is handed a claim. A pregnant woman could game the system easily.

Plan is in effect after birth, the whole pre-natal and delivery process is excluded because it is before the coverage period began. Post-natal and child care would obviously be part of the premium for the family plan they are purchasing.

The chances of a million dollar claim for a newly insured family is the same regardless of the date of birth. Aren't you concerned about all the AIDS and cancer patients with new coverage!? All those pre-ex people with pent up demand for conditions so expensive carriers refused to cover them?

Honestly, I think there is less room for abuse here than we expect.