With legislation ever-evolving in a fast-paced society, it can be challenging for the average person not only to know and understand all of the options available to them but to be able to discern which is best. Health insurance is one particular area that’s changed dramatically over the past decade.
Due to these changes, many people are discovering that opting out of their employers’ group health insurance and seeking individual insurance is better for their needs. Here are the benefits of purchasing individual health insurance.
Flexibility in Choice
Freedom of choice is important to many, especially in light of the Affordable Care Act. Small businesses and those employed by small businesses have limited options for group insurance plans as it is. For those organizations, it often makes more sense to pursue individual plans rather than group plans.
Individuals who wish to choose their own health insurance can look at both marketplace health insurance and non-marketplace health insurance to determine what’s right for their needs. While there are ten key requirements (known as essential health benefits) for both marketplace and non-marketplace plans, individuals can take advantage of competition and find a great coverage plan that suits their budget.
Cost Implications
The main perceived perk of using a group insurance plan is the cost savings offered to a company for subscribing in bulk. However, the plan is often priced and treated as an average or generalization of what the majority of employees in any organization might require. It’s important to remember that the majority isn’t everyone.
There are a few ways in which individual insurance might be more affordable than group insurance. For one, the group insurance offering may be quite comprehensive, which is great if you think you’ll require everything that’s included. If you don’t require all the bells and whistles, then you may ultimately be paying for something you don’t need.
Another cost implication to consider is your partner’s coverage. If you have a child who you know will require braces in the next two years or you have substantial medical bills, having double coverage can be beneficial. If, however, that’s not the case, it rarely makes sense for both partners to be paying for separate insurance policies.
The best way to determine cost savings is to take a critical look at what your average medical expenses are and round up for emergencies. Then compare what you would be paying for insurance and saving by using that plan. If it will cost you more to have insurance than it would to pay out of pocket, you know it’s time to opt out.
Not Enough Coverage or Contribution
Just as there are those who end up paying for too much on an employer’s health plan, there are others who won’t receive enough coverage. Many plans won’t cover certain medications, which is often hidden in the small print. This is also an important consideration for small businesses with limited resources. For those who have extenuating circumstances, it rarely makes sense to buy additional coverage on top of an employer plan. Instead, paying for a better individual plan will streamline efforts and ensure things are covered.
Another consideration is that while many employers offer group health insurance plans, not all of them assist with covering the premiums. So, while you may be receiving a slight discount for purchasing a plan through your employer, the benefits don’t extend much beyond that. If your employer does contribute to premiums, evaluate the cost savings before opting out.
Is Opting Out Right For You?
Despite the widely advertised benefits of purchasing group health insurance, it’s not for everyone. Take time to look at what’s covered by your employer, the deductible you’ll have to pay, and the costs and compare that data to some recommended individual insurance providers before making a decision.
