Questions for ERs with individual health insurance

[Martha]

Really? I thought it was 18 months continuation of your policy from employment plus a few extra percent premium for administrative reasons. So what you get is basically what you had, on your nickel.

Was I misinformed?

No.

 

[perinova]

So if you are healthy, in a place where individual insurance isn't too pricey, and your state prohibits raising rates based on your health or claims, it might make sense to buy an individual policy sooner rather than later.

martha
I see that raising rate due to claims might be a real issue. Do you where I could find information about which states prohibit this practice?

I am thinking that if my future home state (TBD) prohibits the practive I would get a personal insurance early. If not I am not sure it would be worth paying premiums ahead of time. I would get a catastrophic insurance instead. Or none at all.

 

[REWahoo]

Do you where I could find information about which states prohibit this practice?

www.healthinsuranceinfo.net/ has this information, but you will have to look at the summary (chaper 1) for each individual state. I'm not aware of a chart that might provide a side by side comparison of each state.

 

[mark500]

This subject is clearly complicated. No wonder some people end up unable to obtain health insurance.

I called one person at my insurance company and they were of little help.

Does anyone know anything about conversion contract clauses in your group health care insurance policy? Does your policy contract state you can convert to an individual policy without the need for "evidence of insurability?" What good is that?

 

[MJ]

For me, my NY Cobra group insurance is pretty high, but it is still much lower than other comparable individual insurance. One of the reasons I am leaving for AZ is to get much lower high ded insurance.
I never thought about Cobra and the possibility of getting a health condition that could jeopardize changing insurance companies. Since I am a worry wart, i'll probably add this to my long list of worries until I get my new insurance in about 1 1/2 months.

 

[audreyh1]

Really? I thought it was 18 months continuation of your policy from employment plus a few extra percent premium for administrative reasons. So what you get is basically what you had, on your nickel.

Was I misinformed?

Yes, you get basically what you had, on your nickel. But the company may be paying for a much more expensive policy than you would carry for yourself as an individual. For example - paying for pregnancy, dental, prescription, low co-pay, no deductible, etc. At the time my company provided a much more comprehensive plan than we needed. I guess things like this are changing now.

Audrey

 

[Martha]

This subject is clearly complicated. No wonder some people end up unable to obtain health insurance.

I called one person at my insurance company and they were of little help.

Does anyone know anything about conversion contract clauses in your group health care insurance policy? Does your policy contract state you can convert to an individual policy without the need for "evidence of insurability?" What good is that?

Some states require group health insurers to offer a conversion policy. Often conversion policies will not provide the same coverage as your group plan. In addition, conversion policies are usually much more expensive. However, in a few states there are rules establishing minimum benefits that conversion policies must cover and maximum rates that can be charged. Otherwise, if you are not in a state with these limitations, conversion policies tend to have somewhat limited benefits and are very expensive. The upside is you get coverage even if you are otherwise uninsurable.

 

[farmerEd]

Listening to all these in's and out's, caveats, what-ifs, and exclusions, pre-existing condition concerns, etc...its amazing to me that anyone could think that a free-market solution to the health-care crisis would ever work(yes, its a crisis with 40+ million people w/out insurance and costs going up 10+% every year).

Its quite clear, that any "free-market" solution will be to cover healthy young people, and then either drop or gouge elderly/sickly people as they start to need more care...Why would an insurance company aiming to make a profit voluntarily cover someone with a pre-existing and expensive condition unless their premiums covered their care? and if the premiums need to cover the care, are you really getting "insurance".

 

[KB]

KB..... Didn't you mean that the difference between the negotiated rate/fee and the billed amount must be written off by the provider.......not by BC/BS?

Yes, that's what I meant. And the BC/BS plan will enforce it if needed (if the provider balance bills).
Thanks for clarifying my statement.

 

[perinova]

FYI
I just read that generally it is not allowed by insurance companies to increase personal rates due to claims. If true, it remains a good idea always to get your insurance while healthy.

 

[perinova]

Its quite clear, that any "free-market" solution will be to cover healthy young people, and then either drop or gouge elderly/sickly people as they start to need more care...Why would an insurance company aiming to make a profit voluntarily cover someone with a pre-existing and expensive condition unless their premiums covered their care? and if the premiums need to cover the care, are you really getting "insurance".

By insuring the many young and healthy (most of us), the high cost of a few very elderly or sick is not a point of matter, it makes sense as a social point of view and insurance companies do not have to make profits on ALL policies.
IMHO Mandatory insurance (disconnected from employment) or Single payer system are the clear answer.
Of course one can say that with more elderly boomers the cost will increase but well... that's a fact of life: most of us will be old. Someone will need to pay for our health care.: US, helped by our children. The problem is not much different from social social security. The young Gen-X, Baby-bust will pay high cost of health care, social security and also work more because the boomer will be old and retired. (They will also be paid more and have a easy time finding jobs)

 

[Martha]

FYI
I just read that generally it is not allowed by insurance companies to increase personal rates due to claims. If true, it remains a good idea always to get your insurance while healthy.

Depends on which state you live in.

 

[perinova]

Depends on which state you live in.

That's is what I thought too. But Paul Zane Pilzer in is recent book seems to think that it is not allowed. Maybe he generalized. I am going to have to check www.healthinsuranceinfo.net/ mentioned by ReWahoo! to see what I can find out.

 

[Martha]

Let me point you to a dandy chart. On the www.healthinsuranceinfo.net site, click on the link on the right side of the page called Summary of Key Consumer Protections in Individual Health Insurance. It has a chart which describes in brief each state and what is required.

Raising premiums due to age or health is not governed by federal law, so a state at any time can change what it requires of insurance companies regarding premiums.

(The term "community rating" means the same premium for all, no matter what your health status.)

 

[REWahoo]

Thanks for pointing that out Martha. I've visited that website probably 20 times and never noticed that link.

 

[perinova]

(1) The only states 5 with community rating are the most expensive NJ, MA, ME, VT, NY.
(2) All other states will charge a lot for new policies of older or sick individuals. Risk pools are also expensive.

I am concluding that the only inexpensive solution is to move to a state without community rating BEFORE being old or sick. And remain there forever with the same insurance. I am now early 40s. I probably have to do this as soon as possible.
Or should I hope for a change in our health sysytem that will solve those problems in the near future? (<5 years?).

If I don;t retire now because I am trying to put more money aside for my portfolio I may run into a situation that the money I am saving will be completely put to buying a higher cost insurance anyway.

Example
- older or community rating insurance =$1000/mo
- younger =$400/mo
Thats $600 difference. $7200/yr*25=$180000

Oops maybe I should jump now rather than later
___________________________________________

I am also concluding that
- it might not make sense to get any insurance before being sick and put the money to work in the stock market. When getting sick it will be always time to get quotes and find out if it worth it or not depending of what illness.
- what I need instead is a (much cheaper?) ACCIDENT INSURANCE.

Can anyone comment on my thinking?

 

[Martha]

Who knows what the marketplace is going to look like in 5 or 10 years. I can't guess.

There are a number of risks in going bare. One big problem is that if you give up a group plan, you lose portability rights under HIPAA. This means that most insurance plans will have preexisting condition exclusions or waiting periods. This may even be true for risk pools.

 

[mark500]

The "guaranteed group conversion laws" may not be helpful at all.
If you leave a group plan and want to convert to an individual policy, the insurance company must provide coverage. However, they can jack up the rates.
Most states apparently have no limits on the premium increase. Thus, the guaranteed conversion is mostly useless. In states with a high risk pool, they will just offer coverage at a higher cost, making the state's high risk pool coverage the best option.
That must be why healtlh insurance companies like states to have a high risk pools.

 

[Danny]

There are a number of risks in going bare....

Here is an alternative...

Come to think about it I wonder what Christian Scientists do do about health insurance...do they get it just in case they change their mind....can they opt-out at work....anybody know....