Individual health insurance is getting more and more difficult to get in the US.
As many as 45 million Americans are completely uninsured, yet only 14.5 million people purchase health insurance. A recent survey shows the reason: while as many as 90 per cent of these people tried to find individual coverage, they didn’t buy a plan either because premiums were too high or no insurer would cover them.
Individual insurance is already a bad deal. Generally, individual policies will cost much more than group plans and much less coverage is offered. Over 40 per cent of Americans with an individual plan pay more than 10 per cent of their income on their medical care - which included premiums and out-of-pocket medical expenses. With a pre-existing condition - even if a relatively minor one - premiums can skyrocket, while the condition that requires most medical treatment is excluded.
To further complicate the process of shopping for health insurance, plans can vary wildly, with baffling sets of coverage limits, premium structures, deductibles and co-pay arrangements, as well as limits on which doctors can be seen. With no standards, plans are virtually incomparable. Difficult trade-offs face consumers, where their doctor may not be part of the plan, or coverage for mental health, dental health and maternity benefits may only be available as expensive additional riders.
Of concern for the allergic is the apparent tendency for individual insurers to refuse to cover consumers with allergies and asthma. Since these two conditions often come hand in hand, discrimination on the basis of either diagnosis creates a significant problem. A study commissioned through the Kaiser Family Foundation found that both a 24-year-old waitress with simple hay fever and a family with an asthmatic child were either rejected outright or faced exclusions for both the hay fever and the asthma. In fact, the family with the asthmatic child was offered coverage that either excluded the child completely or excluded coverage for the child’s asthma.
While the US government has intervened in the individual market, it remains much less regulated than the market for employer group insurance. High risk pools are only available in 35 states and they are underfunded. Many high-risk pools also exclude the conditions that force consumers to these pools.
President-elect Barack Obama has proposed a health plan which establishes a “connector” or “exchange” which is an organization through which individuals can buy insurance. The intent is that this organization will serve to standardize plans, serve as a buying pool and ease selection of plans for consumers by providing a clear comparison of plans.
Major change is definitely required in order to ensure a fair and reasonable access of consumers to individual health plans.
Source: Center for American Progress
