Individual Health Insurance FAQs
How can one get affordable individual health insurance quotes?
Looking for cheap health insurance? it is possible to control your premiums to a certain extent. If you maintain a healthy lifestyle, avoid smoking and excessive alcohol, are not involved in dangerous activities, and are willing to take a higher than usual deductible, you can get a plan with a premium that is manageable. The premiums will go up as you get older.
How can one control the cost of individual medical coverage?
That is actually going to depend on what you need and want. We have been somewhat spoiled with years of excellent group coverage and are used to going to the doctor for just a small copay, paying a controlled, reduced amount for medications, and receiving bills for only 20% of a hospital bill—after the insurance negotiates off a significant portion of the bill. Groups can get a plan like that because the insurer knows that with a working group of individuals, only a small percentage of them is going to have major illnesses at any given time. To get an individual plan like that is very costly.
However, think about what you “really” need. Most people could afford to pay for an office visit for a checkup or even to get a prescription for the latest virus making its rounds. Some doctors will even reduce the bill if a person is on self-pay. The issue to consider is what could you pay within a year if you suddenly had an accident or illness. Could you make payments on $3,000? $5,000? If so, you could save a lot of premium dollars by putting the amount you would have spent on premium into a health savings account. (These are special tax favored IRA accounts used only for health related expenses.). If you don’t use the savings, it simply carries from one year to the next and earns interest. A single account can be used to pay out of pocket expenses for an entire family.
What plans are available?
The most popular plans are the traditional fee for service, the preferred provider organization plans (PPO) and the health management organization plans (HMO). The traditional fee for service is the most expensive as you can go to any doctor who accepts the plan, and the insurance will pay after your deductible and/or copay. The PPO and HMO plans both involve networks of doctors who have agreed to participate and who often accept less pay for providing service. They are compensated by the insurance company and are encouraged to put an emphasis on “preventive” medicine—more appropriately called “early detection” medicine. This would include things like mammograms, frequent blood tests, and so forth. The PPO and HMO will usually have a lower out of pocket to the patient in return for less freedom of choice in your care. The HMO is the most restrictive, requiring you to see a “gatekeeper” or primary care physician (PCP) for everything. This PCP will give you a referral if he thinks you need to see a specialist, but without that referral, you would be fully responsible for the payment to another doctor.
What is the difference between group health insurance and individual health insurance coverage?
The primary difference can be explained in terms of who controls the plan. With group health, everyone at the place of business is eligible, the employer negotiates for premiums and deductibles, and neither age nor pre-existing conditions of an individual are a factor in price or acceptance. With individual health insurance, all the rules change. The insurer can sometimes set the price based on your age and/or pre-existing conditions. In some cases you could be declined, rated up, or given exclusions. Your rate may change for your age and is also may be adjusted for inflation. Plus if you develop an illness, your rates can be adjusted to a higher risk category. Be sure to work with a local, reputable agent that can explain the proposed policy in detail.