18 September 2008

HIPAA: Health Insurance Portability and Accountability Act

COBRA, bridge with no breaks: COBRA bridges health insurance coverage from old group plan to new group plan, or from old group plan to new individual plan. It may be tempting to forego the bridge, especially if money is tight. Living with no insurance is an obvious risk in terms of immediate health care needs and it also can have long-term consequences for pre-existing conditions when the time comes to sign up for new coverage.

63 days as significant break: Boomers are old enough to remember the horror stories of people denied health coverage because of previous health problems. Our modern plans (nearly all) are covered by HIPAA as well as COBRA, and it's HIPAA that protects us from discriminatory policies or exclusions from coverage. Like most insurance rules we are familiar with, "30 days" has meaning for HIPAA but there's another time line that's important: "63 days." That span constitutes a significant break in coverage—if you go that long without health insurance, your protection from HIPAA is seriously compromised. If there's a gap between coverage (of any sort), the day count matters. So, if you reach the end of COBRA eligibility, don't allow 63 days to pass without replacing it with something, even if that's a short-term individual plan.

Taking precautions: If you use COBRA to the max and stay insured without any breaks, you'll have the best protection against pre-existing health exclusions. Hang onto all "certificates" that prove you have had coverage (insurance providers are required to send you such paperwork) and keep premiums paid. Those are the highlights but the details deserve attention, too. Find them at the Department of Labor's web page on HIPAA, COBRA, and health plan exclusions. (I have found this to be the single best web page for branching out to all these topics. But it is a long read.)

© 2008 Mary Bold, PhD, CFLE. The content of this blog or related web sites created by Mary Bold (www.marybold.com, www.boldproductions.com, College Intern Blog) is not under any circumstances to be regarded as professional, legal, financial, or medical advice. Or education advice. Or marital advice. Or even a tip.


forHealth said...

HIPAA and Cobra mean absolutely nothing and are worthless when moving from a group policy to an individual policy. I say, save your money and forgo Cobra.

Mary Bold said...

You've made a broad claim that may work for you, but could create a hardship for the person who has not researched as much as you have (for your personal application). HIPAA does protect moves to individual plans; but sometimes when the previous plan was individual, that can be problematic. As you research your own options, you may well know precisely what you need or don't need from HIPAA; you may well be able to skip COBRA bridging entirely. Great! But the power of those decisions resides in personalized research for your circumstances. Guard against assumptions. And definitely watch the number of days that constitute break in coverage!