How to Buy Your Own Health Insurance

Guide Note: Buying individual health insurance can be hard, but that doesn't negate its importance. This page will show you How to Buy Your Own Health Insurance.

Introduction

Insurance lets you take care of your family. (Photo by Jyn Meyer)
Insurance lets you take care of your family. (Photo by Jyn Meyer)

The Insurance Market

  • Rights and restrictions on buying health insurance vary from state to state. Some states allow insurers to deny coverage to people with pre-existing conditions, while others require insurers to offer plans to high-risk individuals (though insurers usually charge higher premiums for such plans). Always research your individual situation before making any decisions about insurance.
  1. Check HealthInsuranceInfo.net, a resource provided by Georgetown University, for information on your state's policies.
  2. You can protect yourself by not going without coverage for more than 63 days.
  3. If you have access to COBRA (continuation of benefits from previous employment), paying for your old job's health insurance can offer better and more complete coverage than individual plans.
  4. If you only need temporary coverage, a short-term plan can be easier and cheaper to get than a regular policy.

Find Available Plans

  • Take time to investigate what kind of plans you have access to—60 days if you can. You don't want to sign up with the wrong carrier and be trapped by monthly premiums that don't provide the best benefits you can buy.
  1. To get a list of brokers who work with multiple carriers, so you can get an overview of what's available in your area, check out eHealthInsurance.
  2. Insure.com also has a national database of carriers.
  3. Or contact the National Association of Health Underwriters for a list of local brokers.
    • Try to find a broker who works with multiple companies, so he can find the right insurer for you.

WARNING: Medical discount plans are common, but they only offer a list of providers who give discounts on their services. Such plans do NOT provide health insurance.

Important Factors to Consider

  1. How many doctor visits are you allowed?
  2. How many emergency room visits are covered?
    • Will you have access to the medications you need? (Photo by Bob Smith)
      Will you have access to the medications you need? (Photo by Bob Smith)
  3. Can you see any doctors, or only practitioners within a certain network?
  4. What prescription drug benefits are offered?
  5. If you have children, check if shots and regular check-ups are covered.
  6. If you may become pregnant, see if your potential plan has maternity benefits.
  7. Do you want to forgo dental and vision coverage to find a more affordable plan?
  8. What co-pays and deductibles will you be responsible for?
    • Most lower-cost plans have higher deductibles. Don't make the mistake of choosing a plan for its affordable premiums if you can't pay the deductible.
    • Be cautious with affordable plans that restrict coverage. If the plan only covers a portion of hospital stays or drug costs, it isn't worth buying.
  9. Some high-deductible policies let you meet IRS requirements to open Health Savings Accounts (HSAs), thus making you eligible for a tax break.

TIP: CNNMoney's Health Plan Navigator lets you rate the importance of different health care variables. You can then compare up to three plans with the navigator.

  • Please note that this tool requires you to enter in plan details for comparison.

If You Cannot Find a Plan

  • There are other options, some more appealing and accessible than others, for individuals who have been rejected from, or cannot afford, individual insurance plans.
Don't give up until you have coverage. (Photo by Vangelis Thomaidis)
Don't give up until you have coverage. (Photo by Vangelis Thomaidis)
  1. Check if any group you're a member of offers access to health insurance. Group rates are usually lower, so if you're a member of a union or trade association, you may have access to affordable coverage.
  2. See if you can form your own group.
    • In some states, a business with just two employees can qualify for group plans and their lower rates.

Government Options

  1. High-Risk Pools: Some states offer high-risk insurance pools, where people who have been denied coverage can apply for state-subsidized insurance.
  2. Medicaid: A government program to provide care for people with limited incomes.
  3. State Children's Health Insurance Program (SCHIP): A program for families not eligible for Medicaid who cannot afford private insurance. This program can possibly provide coverage for your children.

Conclusion

  • Although buying your own health insurance can be a trial, it would be even worse to be in a medical emergency and not have coverage. Keep trying until you find a policy you can live with.

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