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The Impact of Pre-existing Conditions on Access to Insurance
During the Obama administration, there was a lot of political buzz surrounding the term “pre-existing condition.” A pre-existing condition is generally defined as an illness or injury that has been diagnosed and/or treated prior to an application for insurance. When the Affordable Care Act, often referred to as “Obamacare,” came into force in the U.S. in 2014, it made it illegal for health insurance companies to deny Americans medical coverage or raise premiums due to a pre-existing condition. As a result, the percentage of uninsured American adults decreased significantly. Fortunately, with universal healthcare being accessible to Canadians for more than 60 years, most Canadians alive today have never fathomed facing financial ruin due to the fact that they or a family member have required medical care. However, pre-existing conditions are very much a part of the insurance vernacular in both countries.
Due to limits in government-funded healthcare services in Canada, insurers offer many products to complement universal health care (OHIP in Ontario). While a pre-existing condition will generally not preclude a group insurance plan member from accessing extended health and dental coverage (including coverage for medications for chronic illnesses like diabetes and heart conditions), they are usually considered in the context of disability, critical illness and life insurance. The wording of the policy will govern whether a person (a) qualifies for coverage and (b) is entitled to a benefit in the event of a claim, despite a pre-existing condition. When applying for such policies, consumers must truthfully disclose their medical history, including symptoms they have experienced, which is usually done in the form of a questionnaire. This allows the insurer to determine the risk and decide whether to insure the individual and what premium to charge. Failure to disclose a pre-existing condition could result in the insurer rescinding the contract and/or denying a claim. If this happens, it is important for the insured person or their family to consult with a lawyer experienced in this area of law to review and potentially dispute the denial.
Pre-existing conditions are also relevant to assessing the value of personal injury claims based in negligence. There are several heads of damages that a person may pursue, including general damages (meant to compensate a person for their pain and suffering), income losses, medical care and housekeeping/home maintenance assistance. An important consideration is whether the claimant had a pre-existing condition that predisposed them to a worse outcome from the injury or whether their condition would have worsened in any event of the injury. Pre-existing conditions that affect longevity and/or a person’s ability to work and live independently are particularly relevant in assessing a claimant’s future income loss and future care needs.