| TO: | ALL COUNTY OFFICES |
| FROM: | JANEL R. LUCK, DIRECTOR |
| SUBJECT: | PRE-EXISTING CONDITIONS AND EXCEEDING ANNUAL BENEFITS OF HEALTH
INSURANCE PLAN FOR MO HEALTHNET FOR KIDS |
DISCUSSION:
Senate Bill 577 (2007) modified Section 208.640 RSMo to provide that employer sponsored health insurance and other health insurance that does not cover an eligible child’s pre-existing conditions are not considered affordable health insurance. Previously, an uninsured child who had access to employer sponsored health insurance that met the affordable insurance standard was ineligible regardless that the employer sponsored insurance did not cover pre-existing conditions. In addition, an eligible child who has exceeded the annual benefits of his or her health plan for all healthcare services, is considered uninsured and does not have access to affordable health insurance. Previously, only children who exceeded a lifetime maximum for all benefits under their health plan were considered uninsured.
House Bill 2014 (2008), signed by the Governor on April 22, 2008, provided funding to implement these provisions effective April 1, 2008.
Pre-Existing Conditions
Health insurance plans that do not cover an eligible child’s pre-existing conditions are not considered affordable employer sponsored health insurance. The applicant must provide verification from the child’s physician that the child has a pre-existing condition. In addition, the applicant must provide verification from the employer sponsored health insurance plan that the plan will not cover a child’s pre-existing conditions.
NOTE: This change does not effect access to private health insurance, as those plans already had to cover all services covered by MO HealthNet, including pre-existing conditions.
New fields are added to the Employer Sponsored Health Insurance (FM8J) screen to capture information on whether or not pre-existing conditions are covered by the employer sponsored policy and whether or not any child has a pre-existing condition.
- In the pre-existing conditions field a ‘Y’ is entered if the employer sponsored policy covers pre-existing conditions and an ‘N’ is entered if the policy does not cover pre-existing conditions.
- In the pre-existing condition exists field a ‘Y’ is entered if a child has a pre-existing condition and an ‘N’ is entered if the child does not have a pre-existing condition.
For more information on how to enter information on access to employer sponsored insurance refer to the “Adding Information on Access to Employer Sponsored Insurance for a Family Healthcare Application” and “Adding Information on Access to Employer Sponsored Insurance for an Active Family Healthcare Case” User Guides.
If the employer sponsored health insurance plan does not cover a child’s pre-existing condition and therefore is not considered affordable, the applicant/participant must provide two private insurance quotes to further determine eligibility for SCHIP premium level of care. If the two private quotes do not meet the private insurance requirements in Section 0920.020.10.15, the child is eligible for SCHIP premium levels of care if all other eligibility requirements are met.
EXAMPLE: Mrs. Maple applied for MO HealthNet for Kids for her daughter Ann. The Maple family income is over 150% of the federal poverty level (SCHIP premium level). Ann does not have health insurance. Mr. Maple has employer sponsored insurance that would cover Ann if he elected to cover her, but it will not cover her asthma, a pre-existing condition. Mrs. Maple provided a letter from Ann’s physician stating that Ann has asthma. She also furnished Mr. Maple’s health insurance member handbook that verifies that pre-existing conditions are not covered. Since Ann is uninsured and Mr. Maple’s employer sponsored health insurance will not cover Ann’s asthma, Ann does not have access to affordable employer sponsored health insurance. Mrs. Maple must still furnish two private insurance quotes to evaluate her access to affordable private insurance. If the two private quotes do not meet the criteria in Section 0920.020.10.15, Ann is eligible if all other eligibility requirements are met.
EXAMPLE: Mrs. Davis applied for MO HealthNet for Kids for her daughter Julie. Mr. Davis just purchased employer sponsored health insurance for Julie, and then learned that her asthma will not be covered because it is a pre-existing condition. The Davis family income is over 150% of the federal poverty level (SCHIP premium level). Julie has health insurance, but it does not cover her pre-existing conditions. However, Julie’s health insurance still meets the definition of health insurance in Section 0920.020.05.10. Julie is not eligible for MO HealthNet for Kids, SCHIP premium level of care, because she is an insured child.
EXAMPLE: Mrs. Davis re-applied for MO HealthNet for Kids for her daughter Julie (same family as above) two months after her first application was rejected. Mr. Davis dropped insurance coverage for Julie because it would not cover her asthma. Julie is now uninsured. The eligibility specialist must determine if Julie must wait at least 6 months before becoming eligible for coverage. The eligibility specialist determined that Mr. Davis did not have good cause to drop Julie’s health insurance coverage according to Section 0920.020.05.15. However, the eligibility specialist must also determine if Julie meets a special healthcare exception to the 6 month waiting period. Because Julie’s physician wrote a letter stating that if her condition is left untreated it could be life threatening for her, Julie qualifies for a special healthcare exception. Mrs. Davis furnished two private insurance company statements that they will not cover Julie’s asthma because they do not cover pre-existing conditions. Although Mr. Davis has access to employer sponsored insurance for Julie, it is not considered to be affordable insurance because it does not cover pre-existing conditions. Therefore, Julie is now an eligible child if all other eligibility requirements are met because she is uninsured, has a special healthcare exception to the 6 month waiting period, and she does not have access to affordable employer sponsored insurance or private insurance because her pre-existing condition would not be covered.
Exceed Annual Benefits for all Healthcare Services
If a child has exceeded the annual maximum benefits of his or her plan for all healthcare services available under the plan, the child is considered uninsured and does not have access to affordable health insurance. The applicant/participant must provide verification from his or her health plan that the child has reached the annual maximum for all plan benefits. The verification must provide a date when healthcare benefits will once again be available for the child.
The eligibility specialist must set a reminder in FAMIS to re-determine case eligibility when healthcare benefits will be available for the child. A new code value, ‘EA’ - exceeded the annual coverage limits for plan, has been added to the ‘Ltd Cover Rsn’ (Limited Coverage Reason) field on the Health Insurance Detail (FMXY) screen to capture when a child has exceeded the annual limits of his or her health insurance plan.
For more information on how to enter Health Insurance details refer to the “Adding Health Insurance Details for a Family Healthcare Application” and “Adding Health Insurance Details for an Active Family Healthcare Case” User Guides.
NECESSARY ACTION:
- Review this memorandum with appropriate staff.
Apply the new guidelines effective immediately.
Employer sponsored health insurance plans that do not cover pre-existing conditions are not considered affordable insurance.
If a child has exceeded annual benefits of his or her health plan, the child is not considered insured and does not have access to affordable health insurance.
Set reminders for exceeding annual limits of the plan as necessary.
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Attachments:
Adding Health Insurance Details for a Family Healthcare Application User Guide
Adding Health Insurance Details for an Active Family Healthcare Case User Guide