Analysis: 1 in 7 denied coverage over pre-existing conditions

The nation’s four largest for-profit health insurers denied coverage to more than 651,000 people over a three-year period, citing pre-existing conditions, according to an analysis of insurer data detailed in a Congressional investigation.

Between Aetna, Humana, UnitedHealth Group, and WellPoint, that averages out to a denial of coverage for one out of every seven applicants, according to an Energy and Commerce Committee memo about the investigation.

The memo, released by Energy and Commerce Chairman Henry Waxman and Bart Stupak, both Democrats, touts provisions in the health care reform bill that address pre-existing condition denials.

But all politics aside, the investigation contains some interesting figures and information culled from thousands of pages of documents provided by the insurers. The memo points out, for instance, that since 2007, the number of denials on the basis of pre-existing conditions has risen each year, outpacing the increase in applications for insurance coverage:

A year-by-year analysis shows a significant increase in the number of coverage denials each year. The insurance companies denied coverage to 172,400 people in 2007 and 221,400 people in 2008. By 2009, the number of individuals denied coverage rose to 257,100.Between 2007 and 2009, the number of people denied coverage for pre-existing conditions increased 49%. During the same period, applications for insurance coverage at the four companies increased by only 16%.

Individuals were denied coverage based on “an extensive list of medical conditions,” the memo noted. One company had a list of more than 400 medical diagnoses used to decline coverage to those seeking it, and common conditions such as pregnancy, diabetes, and heart disease were included on the list.

As we’ve noted, under the health care reform bill, insurers are no longer able to deny coverage to children on the basis of pre-existing conditions, but this does not get extended to all age groups until 2014.

A spokesman for Aetna did not dispute the memo’s findings, but told The Wall Street Journal that they “document what many health insurers, including Aetna, have been saying for years – that the individual market needs to be reformed so we can improve access for all consumers.”

For more, read the full memo [PDF].

-- Marian Wang, ProPublica