Questions Regarding New Jersey Health Insurance Plans, Features & Rates

Frequently Asked Questions About IHC Plan Features And Rates

Question 1: If I have a pre-existing condition and apply for coverage on February 12th requesting that the individual plan be effective March 1, and I enter the hospital on March 2 because of that condition, would I be covered for the hospitalization?

It depends on whether you were covered under prior coverage. If you are not a "federally defined eligible individual," as defined earlier in this Guide, but you were covered for the condition under prior coverage and that coverage ended no more than 31 days before your enrollment date (which is the effective date of the individual plan, March 1 in this example), your new coverage will cover the condition, subject to the terms of the new plan.

If you are a "federally defined eligible individual," and your prior group coverage ended no more than 63 days before your enrollment date (which is the date you submitted a substantially complete application for the individual plan, February 12th in this example,) your new coverage will cover the condition, subject to the terms of the new plan.

If you had no prior coverage, or if any prior individual coverage ended more than 31 days prior to the enrollment date (March 1, in this example) or your group coverage ended more than 63 days before the enrollment date (February 12th in this example) if you are a federally defined eligible individual, the new coverage will not cover a pre-existing condition until the end of the required 12-month "pre-existing condition" waiting period.

Question 2: If I purchase an individual plan with an effective date of March 1 and I am injured on March 3, would I be covered for treatment of the injury?

Yes. Conditions which first manifest themselves after your new coverage begins (i.e., March 1, in this example) are covered, subject to the terms of the new plan.

Question 3: Do I have to satisfy another waiting period for a "pre-existing condition" if I change from one individual plan to another or from one carrier to another?

If there is no more than a 31-day lapse in coverage between the date your prior plan ends and the date your new plan begins, there will be no new "pre-existing condition" waiting period, provided your previous plan also covered you for the condition or you had coverage under the previous plan for at least 12 months, and, therefore, satisfied the 12-month "pre-existing condition" waiting period. However, if you did not entirely satisfy the 12-month "pre-existing condition" waiting period under the prior plan, you will be required to satisfy the balance of the waiting period under the new plan. You will have to provide proof of prior coverage to the new plan.

For example, if you bought a plan from one carrier on March 1 and were required to satisfy a 12-month "pre-existing condition" waiting period, and canceled that coverage on October 1 to buy coverage with another carrier, you would have already satisfied 7 months of the 12-month waiting period. The new carrier would then apply those 7 months to the "pre-existing condition" waiting period, so you would have to satisfy just the remainder of 5 months of the waiting period while covered with the new carrier.

Question 4: I have Plan C and my premium is due on May 1. How long do I have to pay that premium? If I do not pay the premium, when will my coverage end?

There is a 31-day grace period, so you have until May 31 to pay the premium. Coverage stays in force during the grace period. If you do not pay the premium by the end of the grace period, coverage ends as of the end of the grace period. If you incur charges during the grace period and submit a claim to your carrier, your benefit will be reduced by the amount of unpaid premium. For the purpose of the portability provision of the plans, however, the permissible 31-day lapse period is measured from the last date coverage is in force on a premium-paying basis, not the end of the grace period. In this example, premiums are paid through April 30, so May 1 would be the beginning of the lapse period.

Question 5: Why do rates for identical standard plans vary from carrier to carrier?

Each carrier evaluates the benefits required to be provided under each of the standard individual plans and determines how much the carrier expects it will cost to provide those benefits to their customers. Carriers must also price plans to comply with a provision of the law which requires them to pay out at least 80 cents in benefits, services or supplies to their covered individuals for every dollar collected in premiums.

Question 6: If I do not submit any claims to my carrier, will my rates remain the same?

No, not necessarily. The rates for any given individual plan are not adjusted only based on your or your family's utilization of health benefits or lack of utilization. Rather, each carrier reviews its utilization by all persons covered by the same type of individual plan. Any adjustment will apply to everyone covered under the specific plan, not just persons who may have submitted claims.

Question 7: Are rates locked-in for any length of time?

Carriers are not required to "lock-in" or guarantee their rates for any specific amount of time, however, many carriers elect to do so. The rate comparison sheets show the duration of the rate guarantees for each carrier. For more specific information on rates -- or any available rate guarantee -- contact the carriers directly.

Question 8: I am thinking about buying a plan now. I am 56 years old. What does the 15% cap mean for me?

As a new purchaser, the rate you'll be charged for your new plan will be the rate applicable to a 56-year-old purchaser. The 15% rate cap will first affect you next year when your new plan renews. The renewal rate increase will be limited to 15% as compared to the rate you'll pay as a new purchaser this year.