Health Insurance Problems for Diabetics

TN | March 16, 2005

Diabetics, as a group, face the most difficult task finding and keeping health insurance. Legal, economic and psychological factors all pose obstacles to diabetics who need to be covered under health insurance plans. MedSave.com recently updated the article "Health Insurance for Diabetics" to outline the four basic ways that a diabetic can find health insurance.  The updates include links to the most current resources and contact information in each state. This article addresses the practical questions most commonly asked by diabetes searching for health insurance.

Diabetics need to pay close attention to the health insurance laws in their state that are designed to ensure that they have access to medical care through health insurance plans. Unfortunately, these state laws are designed to ensure that insurance will be available but are not designed to ensure that insurance is affordable. Many diabetics are simply unable or unwilling to afford the cost of available health insurance. Many have a need to search for supplemental or less expensive coverage options and are therefore more likely to be vulnerable to disreputable health plans and outright scams, especially those promoted on the Internet.

Most questions from diabetics fall into one of these seven areas:

1) Finding Affordable Open Enrollment Plans

Each state now has at least one health insurance plan open to all individuals including diabetics. Finding these plans is still not easy. Paying for them is even more difficult. In most states this is offered through a high-risk health insurance pool that covers pre-existing conditions after satisfying the waiting period (usually 6 to 18 months). Those who had prior insurance coverage are exempt from the waiting period but because these rules vary state-to-state, it is best to look up your state's specific laws before you change health plans. These open-enrollment plans are not available on the Internet or through insurance agents, so the best approach is to visit the state insurance department Web site for the name of this special insurance provider (usually a local Blue Cross Association) and call the insurer directly for more information. These plans can be very expensive to middle-income individuals, costing up to 100% of personal income above poverty level. Many diabetics are reluctant to alter lifestyle or spending patterns in order to pay for health insurance. Those whose income and assets are below the poverty level are provided free medical care through welfare plans, but there is an affordability gap for a large group of lower and middle income diabetics.

2) Enrolling in Employer-Provided Group Health Insurance Plans

Group insurance plans always accept diabetic employees but require that the applicant be a full time employee who has been employed for the waiting period established by the health plan (usually 30 to 90 days) and be working at least 30 hours per week. Specific eligibility provisions vary as set by state law and the employer. In order to get gain immediate coverage under an employer-provided health plan for diabetes treatment, it is important to have a "certificate of creditable coverage" from your prior health plan. See the article "Understanding a Certificate of Creditable Coverage" and section #4 "short term medical insurance" below for more information.

3) Using COBRA Continuation Coverage

Individuals leaving a group plan usually have the right to continue that health insurance for 18 months (36 months in some cases) by paying the full amount of the premium cost plus a small administrative fee. This program is authorized under federal law but is most commonly administered by the health insurance company. Enrollment is simply a matter of notifying the employer or the insurer and paying the premium. Difficulties arise when COBRA is not available because: 1) the employer was not subject to COBRA law because of the number of employees, 2) the employer terminated the group health insurance plan, or 3) a communication problem caused a delay in the enrollment process. Those who do successfully enroll in COBRA are usually able to convert to individual insurance with the same carrier or transfer to the state's open enrollment high risk pool health insurance without difficulty.

4) Finding Short Term Commercial Insurance

Short term medical insurance is available to diabetics in most states who are not insulin-dependent at www.MedSave.com listed under the product brand names "Secure STM", "Secure Lite" "Secure STM 12 x 3" (a three year policy), "Simple STM" and "American Health Shield". Although these policies last only 6 months, most states allow subsequent policies to stretch the coverage to fill longer time periods. Short-term policies never cover pre-existing medical conditions, but are a great value to diabetics in covering any other problems that might come up in the near future or those who will soon be enrolled in an employer-provided health plan. This coverage is only ¼ to ½ of the cost of other health plans. Most importantly, this is the least expensive way for a person who is in between jobs to ensure that the next employer's health plan will offer coverage for a pre-existing diabetic condition from the first day of coverage - without the need to satisfy a waiting period again. These plans provide a Certificate of Creditable Coverage that may be valuable for benefits under future group insurance plans.

5) Finding Long Term Commercial Insurance

Few good commercial long term health insurance policies are available to diabetics, but there are a few exceptions. All of the following are available to diabetics and can be "stacked" together to raise overall level of coverage or used to supplement other insurance. It is important o realize that none of these plans are designed to pay the expense of diabetic supplies. Commercial health insurance is designed to ensure that the premium collected is more than the benefits provided, especially in the first months of the policy.

Core Health Insurance is a universal coverage widely available throughout most of the United States that provides the highest dollar amounts of coverage under a limited benefit policy. Eligibility is not affected by medical history or diagnosis. This insurance also provides the most liberal coverage and shortest waiting period for pre-existing medical conditions, including diabetes, of all the commercial health plans currently available.

Value Health Insurance - This insurance is available in all states except AK, CT, NJ, WA and WY to applicants under age 65 with controlled diabetes and pays some expenses for pre-existing diabetes after the policy has been in force for 12 months. This is a limited benefit insurance policy that pays a specific dollar amount that is usually less than the amount charged by a medical provider. The policy is renewable until age 65. Maximum benefits, premium rates and enrollment form are included in the enrollment kit. This insurance is available and paid in addition to any other insurance that may be available.

Value Med Insurance - This insurance is available in all states except CT, KS, MN, NC, ND, NJ, NY, RI, VT and WA to applicants under age 65 with non-insulin dependent diabetes.  The coverage provided is generally less than "Value Health Insurance" listed above but the medical eligibility is more liberal. This insurance pays expenses for pre-existing diabetes after the policy has been in force for 12 months. This is a limited benefit insurance policy that pays a specific dollar amount that is less than the amount charged by a medical provider. The policy is renewable until age 65. Maximum benefits, premium rates and enrollment form are included in the enrollment kit. This insurance is available and paid in addition to any other insurance that may be available.

Basic Health Insurance - The well-recognized insurance is available in most states to all applicants regardless of health history. These plans pay for diabetic treatment after 6 months. But as the name implies, these are limited insurance policies that will not pay for catastrophic bills. Be aware that this insurance plan pays a specific dollar amount that is almost always less than the amount charges by a medical provider, but it may still be better than no insurance at all. The complete listing of benefits, rates and enrollment are offered entirely online. Some diabetics use this insurance to pay for deductibles, co-pays and out-of-pocket costs not covered by other health insurance because the benefits are paid in addition to (no offset by) other health insurance plans. This is the least expensive insurance listed, but pays the lowest level of benefits.

6) Using Discount Health Plans

Some of the low priced "health plans" advertised to diabetics are really not health insurance at all but health discount plans. Many have been fooled into thinking these discount health plans are insurance plans. Discount plans do have value in reducing out-of-pocket costs for out-of-pocket medical costs, including diabetic supplies. MedSave.com warns consumers to distinguish these plans from insurance and to avoid overpaying for the discount plan. A good discount plan should cost no more than $20 per month and offer a full refund of all fees for a reasonable time (at least 10 days, 30 days is preferable) if you are not satisfied. The best of these discount plans are available online at http://www.ehealthdiscountplan.com. These plans are issued by a large national health plan administrator and used the same national Preferred Provider network (PHCS) that was highly rated by Consumer Reports magazine. There is a complete satisfaction or full refund guarantee for 30 days to give members a chance to test the discounts on their own. Problems arise when diabetics are lured into discount plans with misleading advertising that seem to offer greater benefits.

7) Health Savings Accounts

Individual health insurance plans for diabetics that allow participation in the Health Savings Account (HSA) program are not yet available to diabetics in most states. Even in those states where this option is available, the required high deductible insurance may not be priced attractively compared to low-deductible managed care insurance options. For example, a full coverage HMO might be available in Maryland for $500 per month but a $2500 deductible HSA-qualified insurance policy might cost $550 per month so few would choose this option. This may change in the future as Congress moves toward expanding HSA coverage by loosening the laws that govern them. If you do have HSA-qualified health insurance, then a free or low-cost Health Savings account can be added online at Healthsavingsaccount-hsa.com. More information about Health Savings Accounts, including an extensive listing of Frequently Asked Questions is available at http://www.healthsavingsaccount-hsa.com.

Personal Enrollment Support

MedSave.com offers personal enrollment support with any of these coverage options without charge  through OnlineAdviser service.  

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