What is the term for the delay in coverage for a covered illness in a group health policy?

What is the term for the delay in coverage for a covered illness in a group health policy?

• A. Waiting period
• B. Grace period
• C. Exclusion period
• D. Eligibility period

Answer: (A)

The term referring to the delay in coverage for a covered illness in a group health policy is known as a waiting period. This is a specific timeframe during which enrolled individuals must wait before they can receive benefits for certain conditions or services after enrolling in the health plan. A waiting period is commonly implemented to prevent adverse selection and to ensure that individuals do not enroll in a health plan only when they are aware they need medical care, thus spreading the risk over a larger, healthier population. It helps insurers control costs and stabilize the risk pool. In this context, the other terms refer to different concepts: a grace period typically allows policyholders a specific time after the premium payment is due before the policy lapses; an exclusion period denotes a time frame during which certain conditions are not covered under a policy; and an eligibility period generally refers to the time frame in which individuals can enroll in a plan or meet eligibility criteria, rather than a specific waiting time before coverage for an illness begins.

The term referring to the delay in coverage for a covered illness in a group health policy is known as a waiting period. This is a specific timeframe during which enrolled individuals must wait before they can receive benefits for certain conditions or services after enrolling in the health plan.

A waiting period is commonly implemented to prevent adverse selection and to ensure that individuals do not enroll in a health plan only when they are aware they need medical care, thus spreading the risk over a larger, healthier population. It helps insurers control costs and stabilize the risk pool.

In this context, the other terms refer to different concepts: a grace period typically allows policyholders a specific time after the premium payment is due before the policy lapses; an exclusion period denotes a time frame during which certain conditions are not covered under a policy; and an eligibility period generally refers to the time frame in which individuals can enroll in a plan or meet eligibility criteria, rather than a specific waiting time before coverage for an illness begins.