Group Health Insurance
Group insurance is also offered through unions, professional associations and other organizations.
If you are offered group insurance at work, you will find that it has many key advantages.
First, it costs you less. Your employer pays for part, if not all of the cost of the insurance.
Your premiums (which are usually paid through your employer) are lower, since the economies of scale of large groups keep administrative costs low.
Second, you generally will not be asked for evidence that you are insurable.
Enrollment occurs when you take the job and/or during a specified period each year, called 'open enrollment.'
Some employers require that you pass a probationary period before you are entitled to health insurance benefits.
Once you choose a plan however, you must keep it for one year, unless you have a change in life status (such as when getting married, divorce, or having a child, etc.) that alters your coverage needs.
Third, employer benefit plans often have better coverage than what you can get on your own.
Some plans include dental and vision benefits in addition to medical coverage (which could be either a fee-for-service or managed care).
Some employers offer only one health insurance plan. Others offer a choice of plans: fee-for-service plan, or Health Maintenance Organization (HMO), or a Preferred Provider Organization (PPO).
Make sure to discuss your choices, plan benefits and limits with your employer.
Step 6 in this guide will provide you with valuable information and tips
to enable you to choose the health insurance coverage that best fits your needs and budget.
Individual Health Insurance
You need to seriously consider getting individual health insurance coverage if your employer does not offer group policies (or if the health insurance offered is very limited), or if you are self-employed or work freelance.
When buying your own insurance, you will be faced with even more choices than what you will be presented in a group insurance plan.
You can get either a fee-for-service plan or a managed plan (HMO, PPO or POS). You can choose the plan that best fits your needs from an insurance company of your choice.
You will find that plans vary widely in terms of coverage and costs.
Note as well that individual plans do not provide benefits as broad as those offered in group insurance.
Individual health insurance plans typically costs you more in terms of premiums and coinsurance payments.
So before you buy a health insurance coverage, know what you need and what is important to you and your family.
Do your homework. Review and use the checklist on Step 2: Assess Your Health Care Needs.
Shop around. Contact different insurance companies, get different quotes or ask your insurance agencies to show you different policies so you can compare.
Consider what medical services are covered, what benefits are paid, and how much you must pay in deductibles and coinsurance.
We'll cover these points in greater detail in the next section.