“Before the ACA, individual insurers in the vast majority of states could collect information on demographic characteristics and medical history, and then deny coverage, charge higher premiums, and/or limit benefits to individuals based on pre-existing conditions. An industry survey found that 34 percent of individual market applicants were charged higher-than-standard rates based on demographic characteristics or medical history.⁴ Similarly, a 2009 survey found that, among adults who had individual market coverage or shopped for it in the previous three years, 36 percent were denied coverage, charged more, or had exclusions placed on their policy due to pre-existing conditions.⁵ A report by the Government Accountability Office estimated that, as of early 2010, the denial rate among individual market applications was 19 percent, and the most common reason for denial was health status.⁶

“While some states attempted to offer some protection to people with pre-existing conditions, these efforts were generally not effective at ensuring access to affordable coverage.⁷ For example:

“• Some states required that coverage be offered to people with pre-existing conditions, but imposed no restrictions on how much insurers could increase premiums based on health status.

“• Some states required that coverage be offered to people with pre-existing conditions, but allowed insurers to exclude treatment for the pre-existing condition. Thus, a cancer survivor could have obtained coverage, but that coverage would not have paid for treatment if the cancer re-emerged.

“• Some states required that coverage be offered to people with pre-existing conditions, but only to those who met continuity of coverage requirements. In practice, a high fraction of people with pre-existing conditions go uninsured for at least short spells due to job changes, other life transitions, or periods of financial difficulty. About 23 percent of percent of Americans with pre-existing conditions (31 million people) experienced at least one month without insurance coverage in 2014. In the two-year period beginning in 2013, nearly one-third (44 million) of individuals with pre-existing conditions went uninsured for at least one month. About 93 percent of those who were ever uninsured went without coverage for a spell of two months or more, and about 87 percent went without coverage for a spell of three months or more.⁸

“• A few states sought to require that people with pre-existing conditions be offered coverage at the same price as other Americans. But without accompanying measures to ensure that healthy residents also continued to buy insurance, these states saw escalating premiums that made health insurance unaffordable for sick and healthy residents alike.⁹

“In contrast, the ACA implemented a nationwide set of reforms in the individual health insurance market. The law requires individual market insurers to offer comprehensive coverage to all enrollees, on common terms, regardless of medical history. Meanwhile, the ACA also includes measures to ensure a balanced risk pool that keeps coverage affordable. To directly improve affordability while encouraging individuals to buy coverage, the ACA offers financial assistance for eligible taxpayers with household incomes up to 400 percent of the federal poverty level to reduce their monthly premium payments.¹⁰ The law also includes an individual shared responsibility provision that requires people who can afford coverage to make a payment if they instead elect to go without it.¹¹“

Source: Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation. ASPE Issue Brief: Health Insurance Coverage for Americans with Pre-Existing Conditions: The Impact of the Affordable Care Act. January 5, 2017. https://aspe.hhs.gov/pdf-report/health-insurance-coverage-americans-pre-existing-conditions-impact-affordable-care-act