Is a Social Security number required to apply for individual health insurance?
When any business entity or individual asks for your Social Security number, it can feel a bit intrusive and interrogative. It is essential to always ask why anyone, no matter what sort of organization they represent, needs to use your SSN and for what purpose. You have the right to question why your personal information is needed. Of course, your Social Security number is an integral part of your personal information and in the wrong hands, it can cause much damage.
In a highly protected setting bound by law, such as a health insurance company, there are certain requirements in order to gather information about prospective clients in the application process. In addition to your medical history, your Social Security number may be required by many insurers in order to complete your enrollment and verify your identity. However, it is technically optional.
According to the Privacy Rights Clearinghouse, health insurers and third-party administers who provide individual health insurance are unable to require your Social Security number. Nonetheless, the insurer or broker may turn you away for coverage if you do not provide one. If you are applying for a government-issued policy such as Medicare, your Social Security number is a necessary component in the application process.
Why Are Social Security Numbers Requested in Health Insurance?
Back in 2007, a law was established called the Red Flags Rule, which was developed by the Federal Trade Commission. In an attempt to diminish identity theft, including the sector of medical identity theft, Social Security numbers were made a requirement by creditors of all sorts. In order to abide by this rule and prevent medical identity theft, health insurers were considered creditors. Though a health care provider cannot legally ask you for your Social Security number, your insurance company is permitted to do so in order to verify that you, the patient, are in fact the policy-holder.
Mandatory Insurer Reporting Law
Section 111 of Public Law 110-173 requires group health insurance companies provide SSNs so that Medicare can coordinate payments with other health benefits. As a member of an employer-sponsored health plan, whether the policy holder or a dependent, your SSN is typically needed to fulfill this law’s requirements. Likewise, anyone who is a recipient of reimbursement for health care services or a settlement through workers compensation, no-fault insurance, or liability insurance must present their SSN in order to receive benefits.
Immigrants who do not have documentation or proof of residency could be identified as “undocumented.” In this way, obtaining health insurance coverage can be a great obstacle for many individuals relocating to the United States.
Medicare, Medicaid, TriCare, the VA and other public health insurance programs require an SSN in order to provide reimbursement to beneficiaries. By having a universal identifier, the process of coordinated care and payment systems is run much more smoothly.
A patient’s death compounds the collection efforts of medical providers including doctors, hospitals, and facilities an individual has used for health care. Social Security numbers simplify the process of collecting any owed funds to the providers.
Individual Health Insurance Exceptions
There are instances where you will not be required to provide your Social Security number on a health insurance application. Whether you prefer to keep your SSN confidential, or you do not have one, there are other avenues of showing an insurer you are a trustworthy, paying resident of the US. Usually, some sort of proof of residency is a must in the underwriting process.
At least be able to show the insurance company you are in the States for a long enough time period to be considered a resident. This includes paychecks, rental or mortgage payments, and other bill payments in a consecutive 6 to 12 month period depending on the insurer.
Golden Rule, the administrator of UnitedHealthOne plans, and one of the largest individual health insurers in the US, does not require your SSN to enroll. Instead, they require proof of residency for at least 12 months and must have visited a doctor in the United States prior to application.
Health Net, a West Coast health insurance company, will also sell plans to clients without a SSN. Depending on your state and the companies available therein, different rules apply and some make it mandatory and others do not. Check your state laws and health insurance companies’ requirements, though. Often times, receiving a physical and providing other documentation can suffice.