There are lots of good reasons why you may be
tiptoeing around without health insurance. Do any of these sound familiar?
You're self-employed and the premiums seem exorbitant.
Your employer doesn't offer coverage.
You're a new hire and have to wait six months or a
year before you can join a plan.
You're not working and therefore don't have access to
The reality is, purchasing an individual medical
policy isn't an easy task. But it's a necessary one. Individual
medical policies are much harder to qualify for, are more expensive
than group insurance and have more restrictions on coverage than
their group counterparts. It's also hard to know where to get started
to buy an individual policy. So what do you do?
Researching your options
The first thing is to decide whether you need
permanent coverage or coverage for a certain period of time, such as
six months (until your group insurance kicks in, for example). If you
only need temporary coverage, you're in luck because there are a
number of private companies selling policies for periods of up to one
year. If you need the insurance long-term, you've got some work ahead
Your first stop should be to check out what our
advertisers offer for individual health policies in your state. Your
next option is to look at the nonprofit medical providers in your
area. These include HMOs (health-maintenance organizations) or your
state Blue Cross Blue Shield. Nonprofit insurers are more likely to
accept you than traditional for-profit insurers, and there may even
be "open enrollment" periods when you can join regardless
of your health.
If you own your own business, even if you're the only
employee, you can actually get group insurance -- which, again, is
easier to obtain than individual insurance. It seems bizarre, but
there actually is group coverage for a "group of one." You
also could consider setting up a Medical Savings Account, which is
described in more detail in a column by Mary Rowland.
Make a list of all the business, professional and
fraternal organizations and associations to which you belong. Call
each one and see if it offers some kind of group medical plan. This
is technically group insurance, but you'll have to be evaluated based
on your own individual medical situation. However, the terms of the
policy are likely to be more advantageous than if you go out and get
coverage on your own.
If you're uninsurable for medical reasons, your first
stop should be to call your state department of insurance. Many
states have special programs to provide medical coverage for children
and adults who can't obtain insurance on their own because of their
medical histories. The premiums are subsidized and it's much less
expensive than if you tried to buy insurance on your own. Ask your
state insurance department for a list of all the health-care
providers in your area that allow individuals to join, and also see
if there are any state programs available to you (even if you're healthy).
Choosing a policy
If you're lucky enough to have a couple of individual
insurance options, how do you compare? Consider these factors in
choosing the policy that's right for you:
What's the deductible? Throw those ideas of a
$250 deductible and $15 co-payments out the window -- they may sound
great for group plans, but with an individual policy, you're probably
facing a deductible of $3,000 or more. But remember: Because
insurance should cover the most catastrophic needs first, the
deductible should figure into your decision-making, but it should not
be the deciding factor.
What's the lifetime cap? In other words, how
much coverage will this policy provide? Does it stop paying after $1
million? $2 million? Does it have an unlimited lifetime benefit? When
you think of how long you may be relying on this policy, the lifetime
cap becomes much more important than the deductible.
Does the coverage exempt pre-existing conditions?
You may have a pre-existing condition that is excluded from coverage
altogether (which may be the main reason you're buying individual
insurance in the first place), or you may have to wait a year or more
before you can get the benefits. What if there's an emergency in the
meantime? Unfortunately, individual policies have strict language
about pre-existing conditions, and you need to read the fine print
carefully before you make a decision.
Do you have any special coverage requirements?
Do you need mental health benefits for you or a family member, or
perhaps spousal coverage? Again, individual policies are not very
generous, but there may be certain policies that provide better
benefits than others.
The bottom line is that getting good individual health
insurance coverage requires work, but the time is well spent. No
matter how healthy you may feel, you still need to consider what
would happen if you were in an automobile accident, or hospitalized
for an extended period, and had to pay those costs yourself.
Individual health insurance can help relieve some of those worries.