General Overview

In the State of Oregon, the Legislature has created a set of rules that govern the way insurance is designed and sold.  The Oregon Insurance Commissioner has the task of enforcing those rules.  For the most part, Oregon is considered an "Accept/Reject" State, meaning that insurance companies are not allowed to charge a client a higher premium because they have pre-existing health conditions.  In most cases (ODS will make counter offers and LifeWise will make counter offers on their drug benefit), companies do not put specific waiting periods on pre-existing conditions listed on an individual/family health insurance application.  This creates an environment where insurance companies are cautious in the way they evaluate an application.  The result is that many applicants have their applications rejected due to their health history.  To balance this, the Oregon Legislature created the Oregon Medical Insurance Pool also know as OMIP, which is the state high risk pool designed to offer people health insurance coverage when they could otherwise not get it based on their health history.  In order to "qualify" for OMIP, an applicant must have either: 1) been rejected for individual health insurance by one of the insurance companies doing business in Oregon, or 2) have a Qualifying Condition that is listed on their application.

Pre-existing Condition Clause

Many clients ask about whether an insurance plan from "Company A" or "Company B" covers pre-existing conditions. This is an important question, and it is equally important to understand the answer.  By Oregon Insurance Code, an insurance company that accepts an application and issues coverage to this applicant, they must cover any pre-existing conditions as any other illness or injury subject to the 6 month pre-existing condition waiting period unless it is specifically excluded in the offer.  Now this is a lot of information to digest, so what does it really mean?

• An insurance company is allowed to decline an application based on an applicants health history for the preceeding 5 year period.
• Exhausting COBRA does not guarantee that an insurance company will issue an individual health insurance policy regardless of your health history.
• An insurance company is allowed to rider a certain condition for up to 2 years listed on an application in order to issue a policy to an applicant. (NOTE: currently only ODS is doing this in Oregon)
• An insurance company can decline one person on an application based on the health history and still issue coverage to others listed on the application.
• When moving from one plan to a new one, the span of time in between can not exceed 63 days in order to waive the pre-existing condition clause.

How long does it take to get a policy in force?

Many companies allow you to request a specific start date for a new policy, however this is not a guarantee that the company will actually be finished evaluating the application by that date.  In this instance, IF the policy is issued, it will be done so retroactive to the requested effective date.  DO NOT CANCEL YOUR CURRENT POLICY UNTIL THE APPLICATION FOR YOUR NEW POLICY HAS BEEN APPROVED! Just because you have applied, it does not mean that you will absolutely be issued a new policy. It must first be evaluated and then approved.  The general rule of thumb is that it takes 30 to 45 days for a company to receive and evaluate an application.  A company is required to render a decision in 60 days or less.  If a decision is not reached in 60 days, it is generally considered to have expired.  Some exceptions exist to this.