Health insurance policy. When does coverage actually cease?
 

We are switching companies and I'm wondering how this all works.

Say you allow a policy to lapse, do they retroactively deny claims or is there a grace period? My agent once said there is a 90 day window but that was years ago.

We are switching to another carrier and I really don't want to make the next payment with my old one at the new 55% higher rate if I can help it.

So lets say an invoice is due for April 1 and you allow coverage to lapse (at 30 days late). Do they then deny all claims during the month of April? Or are you actually covered for a grace period?

What is the actual product being purchased on the bill due April 1st? Is the bill due April 1st a real time bill for coverage during the month of April or is it an advance bill to cover May?

Also, am I correct that my old insurance is on the hook for any treatment that began under the policy period? Say a broken hand at the end of March but surgery scheduled for May or something.

I hope that made an ounce of sense:D Thanks in advance.

It may vary state to state but there is usually a grace period where you are covered. In Virginia it was 30 days. The grace period protects you from retroactively denying a claim while you're in the midst of changing insurers. You still have to pay the insurance premium during the grace period if you submit a claim in the grace period and expect them to pay. If you do not submit a claim within the grace period then you've saved the insurance cost for that month.

Ask you new insurer about Michigan's grace period for health insurance. I don't believe you are paying in advance, but it's been a long time since I sold health insurance.

In theory, you could allow a policy to lapse, say the 1st of April, but on April 20 you have need for health care. Then you simply pay the bill before the reinstatement period expires, then submit the claim. Claims would be denied if you allow your coverage to lapse.

I'd write the check, put it in an envelope, and be ready to send...just in case.

But don't get penny-wise and pound-foolish. Lack of coverage has bankrupt many.

I hear ya, I have the new coverage lined up and ready to go as well.