Individual Insurance Market Rules in New Jersey
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- Can insurance companies deny me coverage?
Insurance companies cannot deny you coverage in New Jersey, all individual health insurance policies must be offered to all residents on a guaranteed issue basis year-round. This means that insurance companies are required to sell coverage to everyone who applies.
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- Can insurance companies charge me more than other people for the same policy?
Insurance companies cannot charge you more than other people for the same policy in New Jersey. New Jersey uses “pure community rating,” which means that rates cannot differ due to health status, age or gender.
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- Can insurance companies exclude coverage of my pre-existing condition?
Insurance companies cannot permanently exclude coverage of your pre-existing condition in New Jersey. Insurance companies cannot permanently exclude from coverage any health problems you disclose, or they find in your medical records, at the time of application by an amendment to the individual health insurance contract (called an “elimination rider”).
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- Can insurance companies make up their own definition of a pre-existing condition?
Insurance companies cannot make up their own definition of a pre-existing condition in New Jersey. Insurance companies can consider something a pre-existing condition if the person received medical advice, diagnosis, care or treatment for that condition prior to enrollment in the plan. They can also consider a condition pre-existing if it was never diagnosed but you had symptoms for which an ordinary prudent person would have sought medical advice, care or treatment. This is called a “prudent person standard.”
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- Can insurance companies accept my application for coverage and later search my medical records for an excuse to deny me coverage for needed care?
Insurance companies are limited in their ability to search your medical records for an excuse to deny you coverage for needed care in New Jersey. If you make a claim for health care services during the first 12 months of coverage, the insurance company can search your medical history dating back 6 months prior to the purchase of your policy looking for evidence that your current health problem was pre-existing.
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- Can insurance companies pay their doctors incentives to provide me with less care?
Insurance companies cannot pay their doctors incentives to provide you with less care in New Jersey. An insurance company cannot pay health care providers incentives to withhold covered care.
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- Can I appeal an insurance company’s denial of care to an outside entity?
A member of any health carrier can appeal any decision to deny, reduce or terminate a benefit to an outside entity in New Jersey. You can file an appeal to the Independent Healthcare Appeals Program. There is a $25 fee for the service and an appeal must be filed within 60 days of the date the final decision was issued.
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- Can I sue my insurance company if it denies medically necessary care that causes me or a loved-one harm?
You can sue your insurance company if it denies medically necessary care that causes you or a loved-one harm in New Jersey. You can sue an insurance company for harm that may have resulted from its denial of coverage or benefits.
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SOURCE: Kaiser Family Foundation State Health Facts, 2007
To learn about all your rights and protections in the individual insurance market, contact the State of New Jersey Department of Banking and Insurance.
