Pre-Existing Conditions Okay; Tobacco Not So Much


The Affordable Care Act has ushered in a new set of rules for health insurance coverage in the United States. The new regulations can be complex, and additional rules will continually be introduced for several years after 2014. These changes affect every American citizen, so it is essential to stay informed about all the elements that can impact your healthcare and your wallet.

New coverage rules

One of the more popular changes to the health insurance law is how individuals qualify for coverage. Individuals with a pre-existing condition can no longer be rejected for coverage, nor can the monthly insurance premium be substantially more if an individual has a specific condition of any kind. This applies whether the individual seeks coverage through the federal marketplace, through the private marketplace or within a small group plan. While insurance companies can increase rates for several reasons, both pre-existing conditions and gender cannot be factored in. This falls under the guaranteed issue portion of the healthcare law.

Smokers must still pay a higher rate than non-smokers

One rating rule that did not change, however, is that insurance companies can still charge a higher rate to tobacco users. This has raised some eyebrows because critics predict tobacco users will simply lie about their usage. Here are the details:

  • Tobacco use is defined as using tobacco in the form of cigars; cigarettes; snuff; chewing tobacco; and/or pipe tobacco, four plus times per week for the last six months.
  • Ceremonial tobacco use is allowed for certain individuals such as Native Americans or Alaskan Natives.
  • There are seven states that will not charge tobacco users a higher rate are Vermont; Rhode Island; New York; New Jersey; Massachusetts; Connecticut; and California. This also includes Washington D.C.
  • Insurance companies will be allowed to charge up to 50% more to individuals who use tobacco; however states will be able to implement smaller percentages as well as no surcharge.
  • Insurance policies must cover tobacco cessation programs, as well as exempt rate increases for those who take part in such a program and are currently under small business plans.


Colleen McGuire

About Colleen McGuire

Colleen McGuire is an independent consultant who has spent most of her career writing about healthcare and the health insurance industry. For fun she blogs, travels and takes a lot of pictures along the way.