What is a private health insurance waiting period?

The waiting period for a private health insurance plan is usually the amount of time a new employee must wait before being eligible to participate in a group health insurance plan. Waiting periods are typical in the health insurance industry as a means of protecting both employers and health insurance carriers. By the same token, waiting periods are very unpopular among consumers and government officials.

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According to the National Association of Health Underwriters one of the primary purposes of the waiting period is to give health insurance companies up to twelve months to look back into a subscriber’s history for preexisting conditions. A preexisting condition may not necessarily disqualify an individual from getting health insurance, but that condition may not be covered should the health insurance company choose to exercise its option.

Length of Typical Waiting Period

How long is the typical waiting period?   Literature from the U.S. Department of Labor explains that the length of private health insurance waiting periods depends on who imposes them and what the purpose is. If a waiting period is imposed by the insurance company it is only to the extent that any preexisting conditions found during that term can be excluded from coverage.

It doesn’t necessarily mean that the subscriber must wait the entire period of time before receiving basic health insurance coverage benefits. However, a health insurance company may decide to deny individual coverage to some people due to a preexisting condition. This is less likely to happen with a group health insurance plan.

You could start receiving basic health insurance benefits right away even though the health insurance company excludes certain types of coverage for up to 12 months.

The Department of Labor further explains that employers have the legal right to impose a three month waiting period before making group health insurance available to employees. This waiting period is applied as a means of protecting employers from workers who would take a job, start receiving health insurance benefits, and then simply quit after they have gotten their checkups, treatments, or surgeries. The law does stipulate that if both an employer and an insurance company impose waiting periods, those periods must run simultaneously.

Excluded Preexisting Conditions

What preexisting conditions can be excluded?   Since health insurance is regulated at the state level each state has set its own guidelines about preexisting conditions and their exclusion. However, as a general rule it is safe to say that serious, chronic conditions which involve a lot of expensive medical care will typically be excluded for coverage by insurance companies. One of the more common examples that is fairly consistent across the board is lupus.  Because lupus is a long term condition that’s very expensive to treat, it is commonly excluded from health insurance policies where allowed by law.

If there’s any good news about preexisting conditions, it’s the fact that in most cases insurance companies cannot look back further than six months. The Department of Labor says there are some exceptions which allow them to look back as far as twelve months, but six months is the limit for most conditions. How a preexisting condition is defined depends on whether or not a subscriber has received any medical care for the condition prior to applying for health insurance.

For example, if a subscriber suffers from chronic neck pain, yet has not sought any treatment or medical advice within the exclusionary period of time, an insurance company cannot exclude that condition from coverage in the future. That makes it possible for an individual who knows he or she has a specific health issue to forestall seeking treatment until a health insurance plan is in force and the waiting period has expired.

Waiting Periods and Public Health Insurance Plans

Do public health insurance plans have waiting periods?   Although most people assume government healthcare plans like Medicaid and Medicare health insurance don’t have waiting periods, they actually do. Their waiting periods are structured differently than those imposed upon private health insurance plans yet they do exist nevertheless. The important thing to remember in this regard is that each state regulates waiting periods for public health insurance differently. That’s true even though Medicaid and Medicare are federal health insurance programs.

Because public health insurance is designed for individuals who don’t have the financial means to purchase a private plan, it’s also assumed they do not have the resources to pay for medical care during the waiting period. Therefore, the length of waiting periods for public health insurance plans tends to be a bit more liberal in practical application. People who qualify for public health insurance have a much better chance of being covered for most conditions then the average subscriber to a private health insurance plan.

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