HEALTH INSURANCE

With all the talk these days about insurance coverage, people can become confused when trying to determine what coverage the need and what the legal requirements are. Generally speaking, group health insurance coverage is the most affordable and easiest to obtain.

Group insurance is a single policy that is issued to a group (usually a business with employees). The group coverage is usually made available to the employee and his or her family. Individual medical coverage is one policy and issued to one person (or family)

The rates for group insurance are generally best because the risk to the insurance company is figured differently. For example, if there is a small business with 50 employees, the insurance company will be receiving premiums for 50. Out of that 50 people, it is almost certain that the majority will be healthy. So if they are paid a premium for 50 people and of those 50 people, two are ill and receiving medical care; the insurance company comes out ahead and makes a profit.

The insurance company will do an over-all assessment of the company before they agree to coverage or quote a rate. If the 50 employees are primarily young, and have no pre-existing illnesses that could haunt them; coverage is easily obtained at a reasonable amount. However, if there are several people employed who are over 50, have had serious illnesses in the past and are not in good health; the insurer could assign a rate that is too expensive for the small business or the employee.

Under the law (The Affordable Care Act) insurance companies cannot refuse to cover any group. They are required by law to offer coverage to the group, regardless of sex, past health issues and age. However, offering coverage and being able to afford coverage is often two different things.

Unfortunately, the insurance requirements have caused a hardship on many small businesses and many people who are in the high risk group have been put on part time so insurance no longer has to be offered, or terminated (or given early retirement). This is tragic, but the employer is in a bind. He cannot afford his share of the premium and keep his doors open. Also, he has to think of the good of the entire group.

By far, group insurance coverage/employee coverage is the better option for just about everyone. The power in numbers assures a better coverage at a lower price. Employers and employees are becoming more creative in how they obtain the legal insurance requirements. The Affordable Care Act may have some things to iron out, but over-all, group coverage is still our best option at this point. It is wise to get into group plans and hang on. As we push on in the insurance game, things can only get better.