The game with health insurance is strength in numbers. When you are part of a group health insurance plan, you can expect lower premiums and often better coverage. However, there are plenty of Americans today who do not have this option. Whether because of unemployment, self-employment, or companies cutting back benefits, millions of individuals are left to find individual health insurance. These families may be shocked to find out how much an annual policy will cost them.
A health insurance plan not tied to workplace benefits is referred to as an individual plans, but will cover your spouse and children. While health plans will not deny coverage to children, for now, in most states, there is no guarantee that an insurer will accept an adult for an individual policy in most states. This may change if the new laws take effect in 2014 requiring all policies to insure individuals regardless of pre-existing conditions.
Pricing is probably the most important and variable aspect of individual health plans, so it's worth it to do the research, shop around, and take into account some of these tips while buying individual health insurance.
The most important costs to look at are your out-of-pocket expenses and monthly premiums. This will tell you what you can expect to pay out of your own money for medical care. Look at the yearly maximums for individuals and family coverage.
Generally the lower the out-of-pocket costs are, the higher the premium is. This doesn’t make sense for relatively healthy family who only goes to the doctor occasionally. Instead, pay a lower premium and opt for higher out-of-pocket costs unless you or your children have a pre-existing condition, or require frequent doctor visits.
Also keep in mind that the premiums for individual plans are primarily determined by the expected health care costs for that individual, so prices will be higher for those who are older and/or less healthy.
2. Look at the Network
If the costs seem too good to be true, look at the network of doctors available. Are your family’s doctors in the plan’s network? You pay more to visit anyone outside the network, so look for a plan with plenty of doctors to choose from.
Look at the fine print, and don’t assume the plan pays for everything. Ask specifically about prescriptions and X-rays. Not all plans cover these two seemingly common medical needs.
4. Emergency care
Read the policy’s coverage for emergency care and hospital stays. Compare costs across different plans for copayments and co-insurance and ask how those costs apply towards the deductible.
5. Maternity Care
If you have a growing family, you may be surprised to know that most individual health plans will not cover a pregnancy and/or labor and delivery. To many insurance companies, the birth of a baby is considered an optional choice, and is not covered through their general plan.
6. Using COBRA
Most employers offer the option to continue health insurance by paying the entire premium. This can be an eye opener when you get the bill, but it’s better to continue with COBRA coverage while shopping for a better policy because it shows you as currently insured, which lowers your risk of being denied coverage.
7. Group Insurance for One
In some states, you can buy health insurance as a "group of one" if you are a self-employed sole proprietor and can show that you've been in business for at least 30 days. If you live in a state that does not offer "group of one" insurance policies, you might still qualify for a group rate if you own a business and have at least one partner or employee. This is at least worth looking into, although sometimes not necessarily cheaper than an individual policy.
Most employees would agree; one of the hardest things about leaving a job is walking away from the benefits package. The key is to evaluate your budget and then shop around to make an informed decision that you and your wallet can live with. Don’t expect this to be easy or quick, experts recommend you give yourself at least 60 days to examine your options and apply for a policy.
There's a lot more to it than when your former employer asked you to check a box and sign your name, but it is important for your health and the health of your family to be protected.