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Under the federal law known as  HIPAA , if you were covered by health insurance for a sufficient period of time, a new employer's coverage will take over at the end of the probationary period. There will not be a waiting period before coverage starts for pre-existing condition. HIPAA applies if the following conditions are met:

  • There are no more than 63 days between the termination of your former health insurance and the start of the new insurance, not counting any time you were in the new employer's probation period, and
  • You had any kind of health coverage, including through an employer, on your own, or through Medicare, or Medicaid, whether the coverage was on your own or through a spouse or parent.
  • the amount of time you had your health coverage must be counted toward fulfilling the new plan's Pre-Existing Conditions Waiting Period. So, if you have health coverage for 12 months, and there is no more than 63 days between coverages, you are not subject to any pre-existing condition waiting period because you get credit for the full 12 months. If you only had the coverage for 7 months, you can still be subjected to a pre-existing condition waiting period of 5 months (12 minus 7 = 5).

HIPAA does:

  • Provide that if your new employer provides health insurance for employees in a position which is similar to yours, you cannot be denied health insurance because of your medical history or current medical condition.
  • Make the transition from one plan to another easier by limiting the period of time a new employer can exclude a pre-existing condition and giving credit against the new exclusion for creditable coverage you already have.

HIPAA does not:

  • Allow you to take your health insurance from one employer to the next in spite of the word "portability" in the title of the Health Insurance Portability and Accountability Act of 1996 (HIPAA).
  • Require your new employer to offer health insurance in general, much less to any particular job category.

If there is a new waiting period you may still be covered under your earlier policy through what is known as a (free) extension of your current coverage, or you can pay for health coverage under COBRA until the new employer's health coverage starts for you. If a pre-existing condition waiting period may apply to you solely because you did not have a full 12 months of previous health coverage, see HIPAA -Pre-Existing Conditions

For additional information see:

Coverage During The Pre-Existing Conditions Waiting Period

Most health insurance policies include a provision known as a Pre-Existing Conditions Waiting Period that postpones coverage for health conditions which started before the effective date of the new coverage. Pre-existing condition exclusions extend for up to 12 months and, in some cases, longer.

While a pre-existing condition exclusion is in effect, any new health conditions are covered, but not expenses relating to pre-existing health conditions.

There are three different ways that you may be covered for your pre-existing health condition during a Pre-Existing Conditions Waiting Period: HIPAA, COBRA and through extensions.


Extensions are built into some employers' health insurance policies.

An extension provides that if you are being treated for a health condition when your coverage terminates, you will continue to be covered for that same condition (but not any other health conditions) for 12 months from the date your former health coverage stops.

If there is an extension in the policy, it automatically goes into effect. There is no cost for this coverage after you stop work

Extensions do not count as coverage for purposes of HIPAA.

A few examples follow.

Example 1: Sam has diabetes and has worked at A Corp. for four years. He changed jobs and went to work for B Corp. His coverage at B Corp. doesn't start until he has been there for a probationary period of three months (90 days). Under COBRA, Sam can continue A Corp's health insurance while he goes through the 90 day waiting period at B Corp. Once he becomes covered under B Corp's health insurance, Sam drops the coverage he had from A Corp under COBRA. He gives the health insurer at B Corp. a Certificate of Creditable Coverage that shows he had coverage with A Corp. for four years which lasted to the day he got his coverage from B Corp. This allows him to be covered for charges related to his diabetes immediately without having to go through a new Pre-Existing Conditions Waiting Period.

If the A Corp. health insurance policy had an extension provision, Sam's diabetes would also be covered under the A Corp. policy for 12 months from the date A Corp's coverage ended.

Example 2: Sandra had Medicaid because she was disabled due to HIV and was collecting Supplemental Security Income (SSI). She lost her SSI and Medicaid when her mother died leaving her $25,000 from a life insurance policy. Six months later, Sandra went to work for C Corp and enrolled in the new employer's health insurance plan. Because Sandra had no coverage within 63 days of getting the health insurance from C Corp, she will be covered under C Corp's health insurance for any illness not related to her HIV, but she will have to wait until the health plan's Pre-Existing Conditions Waiting Period expires before she will be covered for charges related to HIV.

Example 3: Carey worked for his old employer for 5 years. His bout with prostate cancer was covered under his employer's health insurance. Although he started a new job a few days after leaving his old job, he continued his old health coverage under COBRA because he thought he couldn't qualify for new coverage because of his health history. By the time Carey realized he could get coverage from the new employer in spite of his health, it was after the initial sign up period. Because Carey didn't sign up on time, he is subject to an 18 month pre-existing condition exclusion with the new employer. Although he would not have had any new pre-existing condition exclusion because of his prior coverage if he had signed up on time, he's stuck with paying COBRA for the 18 months that COBRA permits while waiting out the new employer's pre-existing conditions clause, plus paying any amounts that he is required to pay as an employee under the new coverage. Even worse, if the new employer has a probationary period of 3 months, the 18 month pre-existing condition exclusion doesn't start until the end of those three months. Carey's COBRA coverage would run out 3 months before the new coverage starts.

Coverage During The Probation Period

Many employers require a probation period when a new employee is hired to see if the relationship will work and to be sure people don't join a company just to get benefits. The probation period is the time when you are literally on probation with the new employer, rather than a permanent hire. The probation period can last up to 6 months.

During the probation period, a new employee is generally not eligible for any of the employer's benefits, including health insurance.

Under a federal law called COBRA and similar state laws you have the right to stay on your former employer's health insurance plan until the new employer's insurance starts.The key is not when you start work with the new employer, but when you actually become covered by the new employer's health insurance.

While your health insurance from your employer is continued under COBRA, you will pay the monthly premiums, to a maximum of 102% of the premium the former employer is charged for the coverage.

If you do not have a right under COBRA, or if you cannot afford the premium, find out if your health insurance at your former employer has an "extension" (described in the next section).

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