Health Reform Creates a New Pre-existing Condition Insurance Plan for Californians

Health Reform Creates a New Pre-existing Condition Insurance Plan for Californians

As a result of the federal Affordable Care Act of 2010, California has a contract with the U.S. Department of Health and Human Services (HHS) to establish a new federally-funded program is called the Pre-Existing Condition Insurance Plan (PCIP). The PCIP offers health coverage to people who are not yet eligible for Medicare, have been denied health coverage due to a pre-existing condition, and haven’t had any coverage in the 6 months before applying. In California, the PCIP is run by the Managed Risk Medical Insurance Board (MRMIB).

The PCIP is available in all 50 states. Some states, like California, have chosen to run the plan themselves, giving them the flexibility to design the plan to meet their state’s need. Other states are having their plan run through HHS and their contract with the national insurance company GEHA.

Each state’s PCIP:

  • Covers a broad range of health benefits, including primary and specialty care, hospital care, and prescription drugs.
  • Doesn’t charge people a higher premium just because of their medical condition.
  • Doesn’t base eligibility on income.

What Are the Costs for PCIP?

In California, premiums are based on the subscriber’s age and region of residence. Below are some sample costs as listed on healthcare.gov:

Monthly Premium: $499 for a 50 year old subscriber in San Francisco
Annual Deductible:
• Medical $1,500 in-network / $3,000 out-of-network
• Brand Name Prescription Drugs $500 in-network / $500 out-of network
Annual Out of Pocket Maximum: $2,500 in-network / no maximum out-of-network

How Long Will the PCIP Last?

This “high risk pool” insurance program will last until December 31, 2013 when the national health reform is set to begin. After that date, this program will no longer be needed as federal rules will not allow insurers to reject persons with pre-existing conditions or charge them higher rates than those without such conditions.

Who is Eligible?

In order to qualify for the PCIP in California, a person must:

  • Be California resident.
  • Have no health insurance coverage for the past 6 months, prior to their application being received. This means in the last 6 months the person was not enrolled in an individual or job-based health plan, including COBRA or Cal-COBRA, or enrolled in Medicare Part A and/or Part B, or in full Medi-Cal.
  • Be a U.S. citizen, U.S. national, or lawfully present individual.
  • Provide their Social Security number (if s/he is a U.S. citizen or U.S. national).
  • Have been denied individual insurance coverage within the past 12 months, for a pre-existing condition as shown by:
    • Rejection letter from a health insurance company in the last 12 months, or
    • Offered coverage with premiums higher than those of the Major Risk Medical Insurance Program (MRMIP) preferred provider organization (PPO) in the geographic region where the individual is seeking coverage.

How Does One Apply and Where Can One Get More Information?

For more information on how to apply and additional questions, see California’s PCIP website or call 877-428-5060 Monday-Friday, 8 a.m. to 8 p.m. or, on Saturday, 8 a.m. to 5 p.m.

You can also visit the federal PCIP website for additional eligibility and benefit info on this program in all 50 states.

Our blogger Karen J. Fletcher is CHA's publications consultant. She provides technical expertise, writing and research on Medicare, health disparities and other health care issues. With a Masters in Public Health from UC Berkeley, she serves in health advocacy as a trainer and consultant. See her current articles.