How Does Medical Insurance Work if I Have a Pre-Existing Condition?

Many people are reluctant to adopt or even initiate a conversation pertaining to health insurance due to the lack of clarity regarding pre-existing conditions.

This mistrust is a result of many insurance companies' past actions, whereby they have either refused to provide coverage or raised premiums due to an applicant’s medical history. We explore the topic of pre-existing conditions and unpack some of its unknowns.

What is a medical plan?

Medical insurance is a specific type of health insurance plan that shields policyholders from paying for treatments brought on by illnesses, accidents, or other health-related problems.

In Malaysia, medical plan generally covers:

• Inpatient costs, including room and board, surgical procedures, and other related expenses.

• Outpatient services like consultations, diagnostic tests, and treatments that don’t require hospitalisation.

• Emergency care.

• Specialist consultations.

• Critical illness coverage for life-threatening diseases, such as cancer, heart disease, and stroke (for some plans).

• International coverage for medical treatment sought outside of Malaysia, catering to those who may require specialised care unavailable locally.

• Additional services like second medical opinions, health screenings, and wellness programs (for some plans).

 

What are pre-existing health conditions?

A pre-existing condition is a medical ailment that a patient had before enrolling with a health insuranceprovider. This can include chronic illnesses like diabetes and critical diseases like cancer.

Depression and the use of prescription drugs may also be regarded as pre-existing conditions in some circumstances.

Is there medical insurance for pre-existing conditions?

Pre-existing conditions are typically not covered by most private health insurance plans in Malaysia. This includes ailments for which the person has sought medical attention, or has even displayed symptoms within a given time frame—typically the five years leading up to the policy's creation.

To ascertain coverage eligibility, insurers generally utilise underwriting techniques such as complete medical underwriting or moratorium underwriting.

Overview of medical underwriting 

The medical underwriting process is essential to evaluate the risk of offering coverage to individuals, especially those with pre-existing diseases. It assesses the medical background, present health status, and lifestyle aspects of the applicants to determine suitable terms and rates for their insurance policies.

The two main underwriting techniques are.

1.Full medical underwriting:The insurer may  exclude specific conditions from coverage based on the applicant's complete medical history, including any pre-existing conditions.

2.Moratorium underwriting: This discourages coverage for pre-existing conditions for a certain period—usually two years— after which the condition might become eligible for coverage if it hasn't returned.

In the Malaysian market, insurers may occasionally offer limited coverage for pre-existing conditions, especially under group policies or special plans intended for those with chronic illnesses.

Some insurers might offer policies that cover pre-existing conditions judged treatable or expected to resolve, or they might give alternatives for covering particular conditions after a waiting period.

Premium loading and coverage denial

Individuals with pre-existing conditions often face higher premiums or even denial of coverage when applying for medical insurance. This phenomenon, known as premium loading, occurs because insurers assess the risk associated with covering individuals who have known health issues.

People with pre-existing conditions may be charged significantly higher premiums due to the perceived risk of increased medical claims. This risk-based pricing model is common in the Malaysian insurance market, where insurers aim to mitigate potential losses associated with high-cost claims.

Furthermore, outright denial of coverage for applicants with pre-existing health issues is intended to protect insurers from adverse selection, where individuals with known health problems seek coverage more frequently than healthier individuals.

As a result, individuals with pre-existing conditions may find it exceedingly challenging to secure comprehensive health insuranceleading to gaps in coverage and augmented financial vulnerability in the face of medical needs.

What is pre-existing condition waiting period?

A waiting period refers to the duration during which an insured individual must wait before they can claim benefits for specific medical conditions or treatments. This period is particularly important in pre-existing conditions.

Typically, the insurer will not cover any claims for certain ailments during the waiting period, meaningpolicyholders will have to pay for their treatment until the waiting period has ended.

Waiting periods for pre-existing conditions may vary between policies and insurers, but they are usually between six months to two years. Some forms of therapy, such as mental health treatment, may have shorter waiting periods—typically two months.

A person's ability to obtain essential healthcare services may be severely impacted by waiting periods. Policyholders may face financial hardship if they need medical attention during this period because they are not eligible to receive benefits for treatments linked to their pre-existing conditions.

Furthermore, people may feel exposed without coverage for their current medical conditions during the waiting period, raising doubts about the insurance policy's efficacy.

Pre-existing condition waiting period example

As an illustration of how waiting periods work, Jane may be searching for health insurance after receiving a diabetes diagnosis. She discovers a plan that requires pre-existing condition patients to wait six months.

Her diabetes triggers issues after four months of covering, necessitating hospitalisation. Sadly, her insurance will not pay for the hospital bills because she is still in the waiting period. Therefore, she will have to handle the costs herself.

Can you get full coverage for a pre-existing condition?

It is imperative to completely reveal all of your medical history at the time of application. Being honest and upfront about your health can actually improve your chances of obtaining more complete coverage over time.

In practice, insurance companies evaluate your risk by using the data you submit. If you fail to declare a pre-existing ailment, the insurance company may later refuse coverage for connected claims, cancel your policy, or even prosecute you for fraud.

Obtaining full coverage for a pre-existing condition is possible in some cases. However, it's not guaranteed. As mentioned earlier, insurers may require a waiting period, during which you can’t claim benefits related to the condition.

However, after the waiting period, if your condition hasn’t recurred or worsened, the insurer may consider removing the exclusion. For instance, if you had a heart attack five years ago and have been symptom-free since, the insurer may cover your condition after a 2-year waiting period.

In the event that pre-existing conditions are not fully covered, consider getting a rider. Some insurers offer riders that provide restricted coverage for particular pre-existing conditions. Although they are more expensive, these riders can offer some protection.

You can also consider supplemental insurance that offers lump-sum payments upon diagnosis of specific ailments. This can help cover out-of-pocket costs not covered by your regular health insurance.

What pre-existing conditions are not covered?

Many insurance companies include tight restrictions on specific types of pre-existing diseases or treatments. For instance, diabetes, asthma, HIV/AIDS, cancer, hypertension, hypothyroidism, hyperthyroidism, heart disease, rheumatoid arthritis, epilepsy, chronic kidney disease, multiple sclerosis, and several mental health issues like schizophrenia and bipolar disorder.

As such, policyholders must carefully read and understand the terms of their chosen policy. To carefully navigate exclusions in your policy, always:

• Examine the policy document carefully, paying special attention to the sections that describe waiting periods and exclusions.

• Contact your insurance agent or provider for clarification if there are any questions regarding the coverage.

• Some insurance companies give riders or supplemental plans that can offer more coverage for particular pre-existing medical problems.Carefully assess these options that assist in completing coverage gaps.

• Ensure that all medical records are up to date and that any pre-existing conditions are documented.

 

What if pre-existing conditions are not declared?

Policyholders risk severe repercussions if they don’t disclose pre-existing ailments while applying for health insurance. Non-disclosure is seen as a betrayal of confidence and can have serious consequences, such asclaims being denied, the insurance being cancelled, or even legal action.

For the insured, this might lead to financial hardship, particularly if they need medical attention for the hidden illness soon after the policy's inception.

Non-disclosure also affects applications for insurance in the future as insurers may see the policyholder as a higher risk, aising premiums or refusing coverage entirely.

Which health insurance covers pre-existing conditions?

Prudential Malaysia offers a range of medical card insurance plans curated to provide comprehensive coverage, including provisions for pre-existing conditions. While precise information regarding pre-existing condition coverage may differ, Prudential stresses the value of affordability and flexibility in their range of medical insurance products.

Our plans are customised to each policyholder's needs, we let them choose the options that best fit their financial circumstances and current state of health.

For those with pre-existing conditions, this flexibility is essential since it allows them to obtain the medical coverage they require while controlling any potential expenses related to their conditions.

We also advise prospective policyholders to speak with our team to choose the best plan for their particular health situation, taking into account any pre-existing conditions. This individualised strategy makes it possible for people to negotiate the complexity of health insurance and pre-existing conditions successfully.

FAQ

Can health insurance companies exclude pre-existing conditions?

In Malaysia, many health insurance providers impose exclusions on pre-existing conditions. Typically, insurers will require a waiting period during which claims related to pre-existing conditions are not covered. These exclusions can last anywhere from six months to two years.

Is a broken leg a pre-existing condition?

A previously broken leg that has fully healed is not regarded as a pre-existing condition. However, a broken leg that develops after the commencement of your policy would be covered.

Is back pain a pre-existing condition?

Yes, back pain is typically considered a pre-existing condition, especially if it has been diagnosed prior to applying for health insurance. Additionally, if the back pain is linked to a chronic condition— like arthritis or degenerative disc disease—it may further complicate coverage options.

Is high cholesterol considered a pre-existing condition?

High cholesterol is considered a pre-existing condition if it is identified or treated before pursuing health insurance. In fact, it's a prevalent ailment that insurers assess carefully.

However, if well-controlled through medication and does not contribute to other health issues, some insurers may not consider high cholesterol a pre-existing condition for the purpose of determining eligibility for future vascular or cardiac events.

Are kidney stones considered a pre-existing condition?

Yes, kidney stones are generally considered a pre-existing condition, even if the individual was unaware of their presence at the time of application. Many insurers may not cover treatment related to kidney stones until a specified waiting period has elapsed, which can range from several months to a couple of years.

Is GERD a pre-existing condition?

Yes, gastroesophageal reflux disease (GERD) is considered a pre-existing condition. Since GERD may lead to serious complications, such as esophagitis or Barrett's oesophagus, insurers view it as a considerable health concern that may impact underwriting decisions and premium rates. Nonetheless, if the condition is well-managed and does not result in severe complications, some insurers may offer more favourable rates or coverage options.

Are varicose veins considered a pre-existing condition?

Yes, varicose veins are generally considered a pre-existing condition by health insurance entities. In fact, many insurance companies are tightening their coverage requirements for varicose vein treatments, viewing them as elective or cosmetic unless demonstrated as medically necessary due to associated symptoms or complications.

Is diabetes a pre-existing condition?

Diabetes is indeed regarded as a pre-existing condition. Diabetes is usually seen as a serious health risk that may influence premium costs as it may result in cardiovascular problems and neuropathy.

Is a bad knee a pre-existing condition?

Yes, a bad knee can be considered a pre-existing condition. In essence, if someone sought a knee replacement due to osteoarthritis, the insurer may deny the claim based on the pre-existing condition exclusion.

Is a C-section a pre-existing condition?

No, a previous C-section (caesarean section) is not considered a pre-existing condition for health insurance purposes. The reason is that most health insurance plans cover pregnancy and childbirth, regardless of whether the mother has had a C-section in the past.

Are gallstones a pre-existing condition?

Yes, gallstones are considered a pre-existing condition. If a person has had gallstones and later requires treatment or surgery, the insurer may deny coverage for those claims if the condition was not declared.

How do you avoid pre-existing condition exclusion?

Being open and honest about one’s medical history during the application process is essential to avoiding pre-existing condition exclusions in health insurance.

So, ensure to truthfully disclose any prior diagnoses, treatments, or symptoms associated with pre-existing diseases. People can better negotiate the complexity of health insurance and secure more by being forthright.

Conclusion

Medical card insurance is essential to most individuals who value their health regardless of their financial stability. It is especially important for families with young children or senior family members.

Anyone wishing to lessen the financial hazards related to healthcare expenses in Malaysia ought to think about getting Prudential’s medical card insurance. It offers a critical financial safety net for individuals and families, enabling policyholders to benefit from direct billing at participating hospitals. Thus lowering their out-of-pocket costs in case of a medical emergency.

The medical card also gives access to specialised services, including second medical opinions. So, you can rest knowing that you're preserving your own and loved ones' health and financial security.