With so many people considering switching themselves, or some, or all family members from their employer sponsored group health insurance plans to personal individual and family medical plans, there are some things that first need to be considered.
Understand that there are major advantages and disadvantages, even some risks inherent to both options the decision to take a family member off of group coverage should not be taken lightly.
The advantages are immediately obvious. The savings on premiums are often significant. The average monthly insurance cost (varies by Zip code – and has probably already increased before the metaphoric ink on this page dries) for a healthy Californian single person is $139/mo. Family premium is, on average, $357.
Typically, employers charge their workers hundreds of dollars more than that for their contributory share
Another advantage of leaving your group plan and choosing individual or family health insurance is that with the latter you have choices. You can opt to cover only what you choose, while saving money on options you consider unnecessary. With private insurance you can choose the deductible, the copay and eliminate anything anything from the plan which you consider superfluous, thus saving a good deal of money.
One other factor in favor of opting for a private plan is that your coverage is not dependent on where you work, or even if you have a job. The coverage is yours. A dissatisfied employee can leave his job any time and not worry about the loss of coverage for himself, or his family. Your employer can move his whole company over to a third world nation and you’ll still be covered, as long as the premium is paid on time. This is not the case with employer sponsored group coverage. There, when you leave an employer, you also leave your insurance behind.
If private, individual, or family health insurance sounds appealing, there are some major issues you need to be made aware of before making the decision. First and foremost, not everyone is accepted in private plans. Preexisting conditions may excluded from coverage and many conditions render a person “uninsurable” altogether to private companies.
Private companies also “rate” their coverage based on age. While coverage may be affordable when the policy is first issued, the age-based increases can render it beyond a persons means. You should review the costs annually.
Private health insurance may be less comprehensive than group health insurance. You are likely to find that some conditions and treatments (such as maternity) once covered are no longer and copays you had taken for granted with group are no where near the value of your group plan. Dollar for dollar your group plan may go farther, but you need to decide how far you need to go, what is important to you and what you can afford.
No matter what your priorities, your decision should not be made alone. You should enlist the help of a trained professional who can spotlight the advantages, disadvantages and potential risks of each path.
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