In Tennessee, health insurance companies are allowed to refuse coverage to adults who have pre-existing health problems. Diabetes is typically considered to be an “uninsurable” condition, but health care reform has extended protection to children. Tennessee health insurance companies can no longer bar families from purchasing coverage based on a child’s pre-existing condition. The same protection is scheduled to go into effect for adults with pre-existing conditions like diabetes in 2014 via the Affordable Care Act.

Through health care reform, people with diabetes who have been continually uninsured for at least six months will have access to health insurance through the Pre-Existing Condition Insurance Plan (PCIP).

PCIP covers health benefits such as primary and specialty care, hospital care and prescription drugs. There are no waiting periods so benefits become available on the coverage effective date, even for a pre-existing condition. Once approved, PCIP applicants have a choice of three plans that have different co-pays and deductibles.

How Expensive Are Tennessee Health Insurance Pre-Existing Condition Plans?

In Tennessee, health insurance premiums through PCIP for 2011 are as follows. The standard plan costs $163 for those under 19, $244 for those age 19 through 34, $293 for those age 35 through 44, $374 for those age 45 through 54 and $520 for those 55 or older. There’s also an extended benefits plan that’s $219 for those under 19, $328 for those age 19 through 34, $394 for those age 35 through 44, $503 for those age 45 through 54 and $699 for those 55 or older.

A third option allows applicants to start a Health Savings Account (HSA), which earns tax-free interest. Withdrawals can be made from the HSA to cover many health care expenses that health insurance plans in Tennessee generally do not cover, like going to the dentist.

Funds can also be used to meet the deductibles. Any money left over at the end of the year, automatically rolls over to the next and continues to grow tax-free like an IRA. At the standard retirement age, HSA owners can spend the funds for things other than qualified health care and pay taxes on the withdrawal. They can also continue to spend the money on qualified health care without paying taxes on it.

Because the health insurance component of HSA plans has deductibles, premiums are generally lower than co-pay Tennessee health insurance plans. Savings on taxes are also available because HSA owners may deduct their HSA contribution from their taxable income.

With an HSA, you can contribute up to $3,050 for individuals or up to $6,150 for family plans and take your deposit as a deduction to reduce your taxable income. There is no minimum deposit requirement for an HSA, though.