Group Policies

You may be able to get group health coverage, either indemnity or managed care, through your job or the job of a family member.

Group health insurance coverage through an employer or other group also has both advantages and disadvantages. Advantages include part or all of the premium being paid by the employer or other policy holder. Group policies are usually less expensive than individual policies. Usually everyone is eligible for coverage regardless of health. Group health insurance coverage is typically comprehensive, and premiums can be deducted from paychecks if the policy holder is the employer. Coverage generally cannot be cut off because of the number of claims someone has. With most group health insurance policies, you can select your own health care providers.

Disadvantages of group health insurance policies include losing coverage when you no longer belong to the group. However, the Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1985 requires a continuation privilege meaning that you can keep group insurance coverage by paying the premium yourself if you leave the group for a specified time period. Widows with dependent children, and divorced or separated spouses and dependent children, and divorced or separated spouses and dependent children may do so for three years. Retired people, their spouses and dependent children may do so for 18 months as can unemployed and reduced-hour employees and their dependent children. 

Many employers allow you to join or change health plans once a year during open enrollment. But once you choose a plan, you must keep it for a year. Discuss choices and limits with your employee benefits office.

Individual Policies

If you are self-employed or if your company does not offer group policies, you may need to buy individual health insurance. Individual policies cost more than group policies.

The advantages of having an individual health insurance policy include being able to tailor the policy to one's particular situation. For example, added protection not available under a group plan may be included in an individual plan or additional protection over and above that available plan or additional protection over and above that available through group plan may be part of one's individual health policy.

Selecting one's health care provider including doctors is another advantage individual health care policies have over some group policies.

But individual health policies do have disadvantages. Requirements to be met before being fully covered may be more restrictive. Individual policies are usually more expensive than group policies. Claims must be filed which is not the case with all group policies. Preventive health care may not be covered. A higher deductible may be part of the individual health care policy, and lower limits for some coverages including major medical, mental health, and chemical dependency treatment may be part of the individual health policy. 

Some organizations. such as unions, professional associations, or social or civic groups. offer health plans for members. You may want to talk to an insurance broker, who can tell you more about the indemnity and managed care plans that are available for individuals. Some States also provide insurance for very small groups or the self-employed.

Medicare

Americans age 65 or older and people with certain disabilities can be covered under Medicare, a Federal health insurance program.

In many parts of the country, people covered under Medicare now have a choice between managed care and indemnity plans. They also can switch their plans for any reason. However, they must officially tell the plan or the local Social Security Office, and the change may not take effect for up to 30 days.

For those people enrolled in the traditional Medicare plan, there are private insurance options that help cover some of the gaps in Medicare coverage. These supplemental policies are sometimes called Medigap or Medicare Supplements (MedSupp). These policies must cover certain expenses, such as the daily coinsurance amount for hospitalization. Some policies may offer additional benefits, such as coverage for preventive medical care, prescription drugs, or at-home recovery.

Call your local Social Security office or the State office on aging to find out what is available in your area.

Medicaid

Medicaid covers some low-income people (especially children and pregnant women), and disabled people. Medicaid is a joint Federal-State health insurance program that is run by the States.