HHS: Coverage Can't be Denied to Sick Kids

HHS offers new guidance to insurance companies regarding the controversial issue of limited enrollment periods for children.

Health insurance companies can’t designate different rules for insurance policies based on whether children have existing medical problems, said the Department of Health and Human Services in a statement earlier this week.

In a letter to the National Association of Insurance Commissioners, Secretary Sebelius outlined efforts by HHS, working with states, to ensure insurance companies keep their promise to “make pre-existing conditions exclusions a thing of the past” for children. The letter comes after insurance companies reneged on their commitment to provide coverage options for children with pre-existing conditions and refused to sell child only insurance policies, according to the statement.

After some insurers announced plans to allow healthy children to enroll year-round but only have a limited "open season" for ones with pre-existing conditions, Sebelius responded by saying that such an approach is legally questionable and "inconsistent with the language and intent" of the health care law.

However, she wrote, rates can "be adjusted for health status as permitted by state law," until 2014, when the federal law prohibits such variation. Since some states don’t place limits on how much can be charged for coverage, parents trying to buy an individual policy for a sick child may still face availability and cost challenges, according to an online report.

The Affordable Care Act makes it illegal for insurance companies to deny coverage to children with pre-existing conditions and makes discrimination against all individuals with pre-existing conditions illegal in 2014—a trend that was rising at exceedingly high rates in recent years. In fact, a recent report from the House Energy and Commerce Committee found that more than 651,000 people were denied coverage because of a pre-existing medical condition between 2007 and 2009.

For policies that begin after Sept. 23, the new health law bars insurers from denying coverage to children up to 19 with pre-existing medical conditions. While HHS had previously said that insurers and states could have a limited enrollment period, the HHS letter offered additional guidance, stating that insurers can't have a window of enrollment for some kids and not others.

HHS has estimated that 31,000 to 72,000 uninsured children with pre-existing conditions will gain coverage due to the provision between now and 2013, and 90,000 insured children will get coverage for pre-existing conditions that have been excluded from coverage, the department estimates. In 2014, no one can be denied coverage due to a medical condition and people will be required to buy insurance or pay a fine.

A number of states, including Maine, Massachusetts, New Jersey, New York and Vermont, already prohibit insurers from excluding coverage of pre-existing medical conditions and about a dozen states allow families to purchase coverage through the Children’s Health Insurance Program. Uninsured children may also be able to obtain coverage through another program in the health law created to help people with pre-existing medical conditions who have been denied coverage, Angoff said.

To read a statement by the AAP in support of HHS, click here.

Click here to read letter HHS sent to the National Association of Insurance Commissioners.

Do you agree with the HHS on this issue, or is it most complex than many believe? Some insurers have dropped out of the child-only individual market entirely—how will that impact the delivery of care?