On the Anniversary of The Affordable Care Act - A Look At The Individual Mandate and Pre-Existing Conditions

Today, March 23rd, is the 2nd anniversary of the Affordable Care Act.  As the Supreme Court begins hearings next week on the constitutionality of the individual mandate, it is important to remember how the individual mandate is linked to how the law deals with pre-existing conditions.

Under the Affordable Care Act, starting in 2014, Americans with pre-existing conditions cannot be denied coverage or be charged significantly higher premiums.  In the past, when some states passed laws requiring insurance companies to accept new members with pre-existing conditions, most insurance companies either stopped offering benefits to individuals or lost millions of dollars.  This is because many healthy individuals did not get coverage, unless they became ill.  When healthy individuals do not get coverage and do not pay premiums, the money is not there to pay the costs for those individuals that are not healthy.

What it comes down to, is that if the individual mandate is removed from the Affordable Care Act, and insurance companies must still accept individual members with pre-existing conditions, it could lead to a situation where insurance companies can only afford to offer coverage though employer groups and not offer coverage to individuals that seek health insurance coverage on their own.

It will be interesting to watch what happens with the pre-existing condition components of the law if the Supreme Court declares the individual mandate unconstitutional but leaves the rest of the law intact.