Individual health insurance coverage is easier to obtain and less restrictive than is commonly believed, according to a study released recently by America’s Health Insurance Plans.
The results of the study, which was based on responses to a survey of AHIP member companies, “demonstrate that the individual health insurance market is playing an important role in providing substantial access and significant protections for consumers,” says AHIP President Karen Ignagni.
According to the study, individuals purchasing their own single coverage paid an average annual premium of $2,268, and those purchasing family coverage paid an average annual premium of $4,424. By comparison, AHIP said the average annual premium for an employer-sponsored plan was $3,696 for an individual and $9,948 for family coverage.
Also of importance, according to Jim Oatman, senior vice president and chief actuary of individual medical for Milwaukee-based Assurant Health, are the study’s findings on the affordability of and access to individual health insurance plans, which contradict the coverage’s image as expensive and restrictive. Instead, he says, the study showed that “given the wide variety of carriers and coverage, you can effectively customize your coverage to meet your particular needs and your particular budget.”
Much of the misconception surrounding individual coverage, Oatman says, can be traced to two factors. The first of these is the system of employment-based health care coverage. Employers generally pay the bulk of health care premiums for their employees, Oatman says, meaning that much of the costs of coverage are “hidden from the individual.”
Second, he notes, individuals seeking to purchase their own health insurance coverage sometimes can be confused by the wide variety of specific add-ons that can be added to coverage, and can end up purchasing coverage for minor things that would better be paid for out-of-pocket. Oatman says this was roughly akin to “including oil changes on your auto insurance.”