Individual, or family, health insurance is also commonly known as personal health insurance or private health insurance. Most insurance companies offering this product will refer to it as individual health insurance. Family health insurance, where you, your spouse and your children are all on the same plan, is still referred to as an individual health plan. This is the type of policy you would purchase for yourself and your family if your employer does not provide insurance benefits to its employees. You may also consider family medical insurance if you are self-employed, unemployed or a student. Individual and family health insurance plans are available for newborns on up to the seniors at age 65. Once a person turns 65, they become eligible for Medicare and medicare supplemental insurance, and must forfeit their individual medical insurance policy.
How are individual health insurance plans different?
The qualifications and regulations that govern individual medical insurance vary from state to state and from one insurance company to another. In all states, the primary difference between group (those plans offered through an employer) and family health insurance is that the health plans available to individuals and families are not guaranteed issue. This means that the private health insurance company may turn you down for coverage based on pre-existing medical conditions or they may approve you for medical insurance coverage but exclude benefits for treatments associated with your pre-existing condition. This is what is referred to as an “exclusionary rider,” which is an addendum to the standard benefits offered under the health plan that you have selected. Some states do not permit insurance companies to place exclusionary riders on individual health insurance policies. This may seem like a good thing on the surface, but the rate of declined applications is much higher in this case because, if the personal medical insurance company is not able to exclude benefits for pre-existing conditions, they will choose not to offer you coverage. The most common example of this is California health insurance. You should research your state’s regulations governing individual and family medical insurance.
How much does individual medical health insurance cost?
The premiums that are charged for individual health insurance plans are based on several factors. These include your zip code, your age, your health status and your lifestyle habits. For instance, smokers will typically pay more for personal health insurance than non-smokers, as will people that are overweight or have pre-existing conditions. Persons that are charged a higher premium are subject to this rate adjustment because the insurance company views them as a higher risk. Once you are covered under an family medical insurance policy, you may not be singled out for a rate increase based on claims history. If the private health insurance company increases your rate, it must increase the rates of all existing plan members covered under the same family health insurance plan. In addition, the insurance company may not cancel your coverage for excessive claims. However, unless you have an HMO plan, your policy will have a maximum annual and maximum lifetime benefit. If your claims exceed the maximum lifetime benefit as defined in your health plan policy, the insurance company may legally cease paying benefits toward any further medical treatments. When this occurs, your policy terminates and you cease making payments for the plan and must find another carrier willing to insure you.
What individual health insurance plans are available?
More information about the options available can be found through the medical insurance resources at the bottom of this page.
Under the individual and family health insurance product category, there are several different types of private health insurance plans available, such as indemnity (fee-for-service) health insurance, health maintenance organization (HMO) plans, preferred provider organization (PPO) plans, point-of-service (POS) plans, and health savings account (HSA) plans. Each plan type differs on two major features: cost and choice. Typically, the more freedom you want in choosing your own doctor and hospital, the more expensive the plan will be. When selecting what type of health plan is best for yourself and your family, you should compare health insurance quotes for each health plan type and shop carefully because coverage and costs vary from company to company and between various plan types.