Based on our experience, about 20% of the California individual health applications that go through medical underwriting (the process of evaluating a person's health history for eligibility) are declined or deferred coverage.  This can be frustrating for both the applicant and us as the health broker.  The process of choosing a California individual health insurance plan not to mention completing the application and underwriting process can be time-consuming.  After this effort, a letter of declination can be a let down.  First let's look at the underwriting process a bit and how the underwriter looks at things.

The underwriting process and health insurance declinations

You submit your application and health history questionnaire to the California health carrier for review.  Based on the information listed in the application and any medical records that are requested, the carrier will come back with either an approval at the best rate; an approval at a higher tier (higher rate); or a declination/deferral.  This process can take a few days to over a month depending on how complex a person's medical history is and how smoothly medical records are retrieved (if needed). 

The letter of declination from the health carrier

They will send a letter to the applicant with an explanation of their decision.  There is a lot of legal verbage on the letter but the important items are the listed health issues.  They may read as  "broken bone within last year"; "ongoing multiple medications", "height and weight outside guidelines", etc.  The carrier will usually list all items in your history but usually there's one or two that's critical to their decision.  There is also information in the letter about refuting or appealing their decision based on missing or incorrect information.  This can happen as doctors will sometimes note issues in medical records which are not correct or unknown fully to the patient.  There may be issues listed that the applicant can clear up with the underwriter via written appeal.  If there is no new information that can be appealed (there listed reasons are correct), then the applicant may need to look at other options.

Health insurance options for someone who is declined coverage

1.  Cobra or Group option.  If you have a continuation option through a prior company-sponsored health plan, make sure not to lose that option or exhaust the enrollment period.  Some people want to apply for individual health insurance to compare with their Cobra option.  You want to make sure that the Cobra eligibility window does not close.  Always keep this option open.  Also, if you have health insurance options through a new company, qualified group health insurance in California is guaranteed issue which means they cannot declined you due to health.  Make sure not to lose this option either.  HIPAA guaranteed issue may be an option as well if you have exhausted Cobra and/or met the requirements for HIPAA coverage.

2.  Apply for other carrier.  There are times when we get a declination from one carrier and an approval from another carrier for the same client.  Carriers tend to tighten and loosen underwriting depending on what's happening on the claims side.  In California, the major carrier underwriting tends to be more pragmatic with Anthem Blue Cross, Blue Shield of California, Health Net, Pacificare in that order.  Kaiser does not deal with brokers so we are unsure as to their underwriting.  There is no downside in applying to multiple carriers (aside from the time and effort) as they do not charge an application fee and you have a 10 day free look period after notification from the carrier of their offer to cancel the coverage never effective.

3.  MRMIP through the State is a back-up option to investigate.  MRMIP is administered through the major carriers (primarily Anthem Blue Cross) for people without options. 

4.  Tonik application declined.  Tonik health is a simplified issue plan which means that they cannot request medical records.  They make a decision based on the information listed on the application.  If you are declined coverage with Tonik, it might make sense to apply to a standard plan with Anthem Blue Cross.  There are many health issues which a carrier needs to request medical records for in order to make a decision and the standard plans will allow the underwriter this option. 

Qualify for medical insurance based on good health

The take away from this is that the time to apply for individual family health insurance in California is when you are healthy.  Do not wait for health to change as insurance does not work that way.  If you have continuous coverage, you can help to situations where you are declined coverage and limited in options.

Other important concepts to help you understand your California health insurance quote are:

Question on the individual health insurance application
Individual health insurance underwriting
Enrolling for Individual health coverage in California
Download the health application or apply online
What can delay your individual health application
Options for people who do not qualify

To run your instant health insurance:

California Individual Family health insurance quote
California group health insurance quote