Individual Health Insurance Plans More Affordable

Health Insurance Plans

A new study shows that most employees in most countries would do better with individual health insurance plans rather than participating in group coverage. Zane Benefits, which provides software as a service platform for entrepreneurs, found that the cost of individual insurance plans 50% less than group coverage for an average of 80% of the applicants who are medically eligible. According to the study:

"The dramatic changes relative prices of the individual versus the group policy has occurred since 45 U.S. states allow insurance carriers to distribute the individual health insurance with medical underwriting. Allowing medical underwriting means that the insurance carriers may refuse to accept, or (ie charge more for) uprate applicants based on their health status or age. KY, WA, and NH changed in 2003 to allow medical underwriting. "



Of course, what medical underwriting people who believe in free markets will call the insurance should work. An insurance company take the financial risk is based on a number of quantitative factors - your health status and your age is just a few of the most common - and charge you premiums that take into account payments, overhead, and, of course, profit. Countries that seek to manipulate the underwriting process by forcing insurance companies to accept all applicants and not allow them to adjust premiums so-called "guarantee issue" state - and it should not be surprising that these countries also have the highest rates for individual health insurance.

The study also noted that current regulations may make individual health insurance more affordable that even the study showed. These include:

• Individual health insurance is guaranteed renewable. That does not mean your premiums will not increase. But that does not mean you cannot lose your coverage based on your claims history.
• Health Reimbursement settings now allow employers to pay employees a tax-free, the cost of individual health insurance.
• Employees can get guaranteed insurance issue with the HIPAA mandated risk pool. - Federal health care reform will require a national risk pool would offer guaranteed issue insurance to people who had previously been uninsured.

This study reaffirms our belief that while health care is far from perfect and in need of reform, often innovation and new ways of thinking about the coverage offered solution is lighter and more affordable that the government mandates and intervention.