Insurance: Medical insurance reforms change landscape for US policies
The USA's Patient Protection and Affordable Healthcare Act 2010 comes into force in a few days. It will make fundamental changes in the US health insurance industry.
Amongst the major changes are that companies must allow parents to keep children covered by family policies until the age of 26 - the US hopes to bring at least a fifth of uninsured under 25s within the insurance regime in this way.
New policies must include cover for preventative care - intended to reduce the overall cost for remedial treatment.
Also included is a ban on lifetime caps - often used in cases such as cancer or AIDS where long term treatment becomes very expensive.
Of aid to parents is a provision that companies cannot pick and choose family members for a family policy: they cannot exclude children with a pre-existing medical condition.
Where an application is found to contain an error, insurers often revoke or cancel coverage on the basis of "in good faith" terms which require "full disclosure." But many people do not know what "full disclosure" entails and innocent and de miminis (e.g. a broken finger) omissions are made. In future, such innocent or de minimis mistakes must not be used as grounds for cancelling a policy and refusing cover.
But it's not all good news for consumers: the insurance companies are being required to put these measures in place in readiness for 2014 where the majority of Americans will be required to put in place their own health cover to take up the slack in Medicare.
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