Long-Term High Risk Health Insurance
There are typically two kinds of health insurance: group insurance plans that are provided by an employer and individual policies. If you do not have health insurance through your work you will need to purchase an individual health insurance policy. However, if you have health problems or a pre-existing condition you can be denied coverage. When this happens you may need to look at a your state's high-risk health insurance pool for long-term coverage.
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Purpose
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The purpose of state-sponsored high-risk health insurance is to provide insurance coverage to residents who cannot purchase a health insurance policy in the standard market. This is typically the case for people who have pre-existing conditions and have been denied coverage by a private health insurer. State-provided high-risk insurance pools are administered by private health insurers who collect premium payments and pay for medical costs that result from claims.
Costs
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The costs for a state-sponsored high-risk insurance plan are going to be higher than those of a basic health insurance policy from the private market. Premiums for a policy are typically up to 150% to 200% higher than the average premium for an individual health insurance policy. These plans also have higher out-of-pocket costs such as deductibles. The deductible for a state-sponsored high-risk policy can range from $1,000 to $8,000 or more.
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Eligibility
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State-sponsored high-risk insurance pools have eligibility requirements that need to be met in order to obtain an insurance policy. In all states you must be a legal resident in order to apply for coverage. You must also provide proof that a health insurance policy is not available from a private health insurance company. Proof can be provided by making a copy of a letter of denial or a notice of involuntary termination.
Waiting Period
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Most state insurance pools have a waiting period that applies before coverage becomes effective. This is because state insurance pools, unlike most private health insurers, do not include pre-existing condition exclusions. However, they do have a waiting period between six and 12 months for coverage of a pre-existing condition. Waiting periods are typically imposed to prevent individuals from waiting until they are already sick to apply for coverage.
Waiting List
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Many state's high-risk insurance pools, such as the one in California, may have a waiting list of many months before residents can apply for coverage. States may have waiting lists because their insurance pool has met an enrollment cap. However, individuals who are on a waiting list may be able to have credit apply towards the waiting period for a pre-existing condition.
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