February 27th, 2009

Reports Philadelphia Inquirer reporter Michael Vitez:

Nicholas Simon was just 34 days old when he received his first rejection letter.

“Dear Nicholas Simon,” began the March 2008 letter. “We appreciate your interest in the Aetna Advantage Plans for Individuals and Families. After careful evaluation . . . we are unable to offer coverage and have declined your application.”

Nicholas seemed unfazed by the news, slurping down his mother’s milk, emitting a manly burp and drifting off into post-nursing bliss.

His great transgression was he had jaundice on his fifth day of life. The bilirubin count in his blood – a key measurement – was 13.9.

“At 5 days old,” said his pediatrician, Herbert Cady, “anything under 15 is normal.”

Aetna felt otherwise. “Over 12 can indicate an underlying liver condition,” said Aetna’s Cynthia Michener. “We couldn’t price a policy in a range that anybody could actually pay for. If we can’t price affordably, we don’t accept.”

The rule that excluded baby Nicholas Simon for a preexisting condition is one of the thorniest – and most reviled – parts of commercial health insurance. Ending it could make insurance more expensive but the country seems poised to make the change.

President Obama told the nation Tuesday that “health-care reform cannot wait,” and vowed “quality affordable health care for every American.”

A key to accomplishing this, Obama said repeatedly during his campaign, is eliminating preexisting-condition exclusions that deny coverage to countless Americans like little Nicholas Simon.

Health insurers also want to change the rule if everyone is required to get insurance.

…

Most Americans today get health coverage through group plans offered by employers. When workers receive insurance through their jobs, an insurer cannot exclude them from coverage, or charge more, because of a preexisting condition.

But for increasing numbers of Americans who are losing their jobs and their group coverage – or who never had it to begin with – a primary option is to buy insurance as an individual or family on the open market.

In 44 states, including Pennsylvania, insurers are allowed to deny coverage – or charge more – to individuals and families because of preexisting conditions, according to the Kaiser Family Foundation.

Read Vitez’s entire in-depth report at the Inquirer.