Filed in: The Employee Retirement Income Security Act of 1974 (ERISA) Laws
Specific Ways ERISA Protects Consumers
Prohibits Plan Discrimination: ERISA prohibits employer-sponsored health from discriminating against you. Examples of discrimination prohibited under ERISA include barring you coverage or access to a plan, or charging you more for coverage, if you are sick or have a pre-existing medical condition, or have not recently had insurance coverage.
Second Chance to Obtain Coverage: ERISA also requires that you be given a “second chance” for coverage if certain things change if you had previously turned down coverage. For example, if you did not opt to join an employer’s health plan because you had coverage elsewhere but lost coverage, ERISA provides that you be given 30 days to enroll in your employer’s plan.
Other situations that trigger this 30-day second chance requirement include a change in family status (marriage, to add a spouse or step children) or you have a new baby (by birth or adoption).
Pre-Existing Conditions: While you cannot be denied coverage for a pre-existing medical condition, your benefits may be limited. ERISA caps the maximum period that a plan can exclude coverage for a pre-existing condition to no more than twelve (12) months.
But ERISA also requires that if you had prior coverage under another plan for the pre-existing condition, you must be credited the amount of time you were covered. For example, if you have diabetes, and had medical insurance under a plan for twelve months prior to applying for the new employer-sponsored plan, that previous 12 months of coverage must count towards meeting the 12-month wait period for new coverage. In that situation, your new plan could not make you wait 12 additional months to get the same coverage.
However, it is important to understand that this previous coverage cannot have lapsed (in most cases) for more than 63 days. If you went uninsured longer than 63 days, ERISA does not require you be credited with prior insurance coverage history.
