Health Insurance 101: Can I Go From Substandard to Standard Risk?

A Smoker, A Diabetic, And An Asthmatic Walk Into A Bar…

When it comes to health insurance, there are certain factors we can control--and certain ones we can’t.

What can we do about our genetics and our lifestyle choices that will insure we get the best health insurance for our buck?

How Pre-Existing Conditions Affect Health Insurance

A pre-existing condition is a medical condition that existed before a health plan was in place. These conditions can include diabetes, asthma, cancer, and the like. Whether or not these diseases are congenital does not affect how the pre-existing condition is treated in the underwriting world.

Underwriting is the process of analyzing and taking on risk. In insurance, your application and medical records are examined by an individual underwriter, who compares you to a large pool of applicants. This helps them to determine how much your risk is “balanced” by the circumstances of others in the pool. Age, health conditions, weight, and even gender affect the balance. For example, a female is generally reviewed as a preferred risk over a male-- because statistically females live longer.  

Within health insurance, anything besides Obamacare will typically make you wait 1-2 years before receiving any type of coverage regarding that pre-existing condition--IF they accept the pre-existing condition in the first place.

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Lifestyle Changes And When They’ll Take Affect

Unlike pre-existing conditions,  the factors you can control--for example, any nicotine habits or how much you weigh--can work out in your favor.

But how much change is needed to affect your risk level, and when will any changes in lifestyle take effect?

Say you want to kick nicotine and you’re already covered. On average, you’re paying $50-$60 more per month for your coverage than would a non-smoker. You can submit a change in your status, but only after you’ve been off of nicotine products for one full year.

Or, say weight is a factor. For all its flaws, underwriters still use the BMI to determine whether someone is overweight. Taking a look at the BMI index will help you determine what category you fall into. Keep in mind that the BMI is largely unisex and does not take into account the difference between fat, muscle, and bone. While some underwriters take this in strides, it’s not guaranteed.

So, let’s say you’d like to lose some weight and bring down your premium. Your first 10 pounds account for the largest change in premium, and anything more than 10 pounds will only be credited by half--unless you’ve kept off that weight for more than a year.

Take a look at it this way:

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Peter weighed 300 lbs when he first had his health insurance plan. In the past six months, he’s lost 80 lbs.

​But what the insurer takes into account is this:

300 - 10 lbs - 35 lbs (or half of 70, the amount of weight lost after 10 lbs) = 255

So, even though Peter technically weighs 220 lbs, the insurer will treat him like he weighs 255 lbs.

Happily, Peter is able to keep off this weight for a full year, and is then credited as 220 lbs and his premium is adjusted accordingly. The insurer, again, makes this decision based on statistics. Many people who lose weight gain it back within a short period of time, so the insurer will mitigate risk by making sure any new habits have at least a one-year shelf life.

Need A Quote?

One of the things you can control today is whether or not you request a free health insurance quote.

We’ll find out where you’re at right now and where you can be, premium-wise. And yes, we have options for you outside of Open Enrollment.

What are you waiting for?

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