So you’re thinking about applying for individual or family health insurance, but the thought of completing an application usually ignites a string of panic attacks. Don’t worry you are not alone. In fact, some health insurance companies have considered including a brown paper bag and stress ball with their application packet. Okay, fine. I made that up. However stress, anxiety and frustration are likely a trio of emotions you will encounter if you don’t familiarize yourself with the application process before hand.
Your application is going to be broken up into eight general sections. It’s important to remember that each insurance company’s application is different and could require information specific for that company. This is why you will want to have an independent agent on call to help you through those subtle difference. However there are eight primary section of an application you will have to complete to obtain coverage.
Section 1: Basic Information
This should be the easiest part of the application, at least I hope so. If not, you might have bigger problems that need addressed first. The information needed here should be straightforward, name, address, phone number, email, etc. This is also where you will list the information of everyone who is to be covered under the plan. That will include social security number, date of birth, tobacco use, height and weight. Make sure you have all these details on hand to speed up the process.
Section 2: Plan Selection
You spent all this time researching what plan is going to be right for you, now you want to make sure you actually apply for the right one. While you think this might be the second easiest part of the application, I have had plenty of people accidentally apply for the wrong plan. To make sure you have selected the proper plan, match up the name of the plan from your quote to the corresponding option on the application.
Section 3: Dental Coverage (Optional)
Almost all health insurance policies will offer some kind of optional dental coverage. It’s important to note that this coverage is generally not included and will cost extra. If you are interested in adding dental, but did not receive a quote including that coverage, you will want to make sure to ask your agent how much it costs and the details of the coverage.
Section 4: Term Life Coverage (Optional)
Again, you will almost always have the option to add some kind of term life insurance to your health insurance. The amount of coverage ranges from around $10,000 - $50,000 and is only in force as long as the health insurance. Again, this coverage will cost extra and you should find out how much before impulsively checking the box. The best part about adding this coverage on to your health insurance is that you will not have to undergo a separate underwriting process and only have to pay one bill. However, if you purchase a separate term life policy you can generally get more coverage at a reduced cost.
Section 5: Other Coverage
Here you are going to need to list any other coverage you are currently eligible for (Medicare) and any coverage you have had recently. This generally means providing the name of your current or previous insurance company and your identification number. You want to provide this information so your new insurance company can determine if you qualify for a preexisting credit for having continuous creditable coverage. To do so you cannot be without creditable coverage for longer than 63 days.
NOTE: This will no longer be a factor starting January 1, 2014 when the final provisions of the Patient Protection and Affordable Care Act take place.
Section 6: Medical Eligibility/Health History
This is what I like to call the main event. For the next thirteen months insurance companies will be asking you for a detailed account of your medical history dating back 10 years. Here you are going to want to be very specific and give them exactly what they are asking for, nothing more, nothing less. It’s alright if you forget a random doctors office visit you had six years ago for a sinus infection. It’s not okay if you forget to mention that heart attack you had two years ago. Just do your best accumulating that information and don’t leave out any major procedures or conditions.
Note: Medical underwriting will also no longer be part of the health insurance application process after January 1, 2014.
Section 7: Billing Information
Now you get to decide how you want to pay for your new health insurance policy. All the standard payment options are available with most companies. You can have the payment taken directly out of your checking account, pay with a credit card or you can have bills mailed directly to your home.
Section 8: Terms and Conditions / Signature
You are almost home free, you just have to read a page and half of all the important stipulations put forth in the policy. Don’t worry, most of it’s just saying you agree to buy insurance from that company, however there are few nuggets of wisdom in there that you will want to be aware of just in case. Be sure to read through them and ask your agent for further explanation if there’s something you are not clear on.
There you have it, you should be able to fill out an individual health insurance application in your sleep now. There will undoubtedly be major changes to the application process after 2013 when health care reform is in full swing. Until then, use this guide to help you make sense of your next health insurance application.
Have you had trouble completing a health insurance application? Did your troubles prevent you from completing the process altogether?