Pre-existing condition insurance plan (PCIP)

Insurance is available for every individual with pre-existing medical conditions in every states.  

revised May 21, 2012

Pre-exiting condition insurance plans (PCIP) are a temporary provision of the federal health reform law of 2010. The high cost of providing medical insurance to those with higher than average medical costs is subsidized by the federal government. There are, however, strict rules on access to the PCIP run by each state.

As of May 2012, insurance agents are no longer paid by the U.S. Department of Health and Human Services to explain the details of the program and help with enrollment so separate arrangements must be made privately to get professional help with a PCIP.

The PCIP is designed to require the applicant to go through a period of financial hardship before admission to the PCIP. An applicant must not have access to other major medical insurance and must endure a six month period without major medical insurance before the date of application to the PCIP. Some limited benefit supplemental insurance policies may be combined with a PCIP to increase the level of overall coverage prior to and during enrollment.

Nationally only 56,000 people are covered through the PCIP plans (compared to the federal government's estimate of 200,000 for the program) yet the dollar amount of claims for each participant is significantly more than expected. Although more than $2 billion of the $5 billion allocated has already been spent, the PCIP program is expected to be solvent through 2013. On May 18, 2012 the U.S. Department of Health and Human Services published a draft of its plans to eventually transition convert the PCIP members to the state insurance exchanges.

Further information on the PCIPs for each state is available at the federal insurance clearinghouse. This insurance is typically not available through insurance agents but personal advisory and enrollment support is offered through the OnlineNavigator program as part of an employer-provided benefit plan or as an individually purchased advisory service.

Those who do not qualify or cannot afford a PCIP may wish to consider a guaranteed issue limited benefit insurance plan like Core Health Insurance. These plans limit major coverage (hospitalization and surgery benefits) for one year but offer other coverage immediately. The dollar amount of coverage is significantly less than a major medical policy but at least these policies allow an individual to initially access the health care system and are frequently used by individuals to "buy time" until the PCIP is available after a six month waiting period without major medical insurance.

About the author - This Web page and related content is written and periodically updated by consumer finance writer Tony Novak, CPA, MBA, MT who is also a life and health insurance agent in all 50 states and DC. Comments, questions, feedback and updates are welcome to help keep content relevant and up-to-date. Contact the author directly by e-mail, on Twitter or through the contact information included on his Web site. Article reprint rights as well as specifically customized content may be available on request. Some content may be offered for reprint without charge; other content will be offered for a fee that exceeds the minimum amount regulated by international Web copyright laws. Reprint is not permitted without written license.