Why do individuals pay so much more for health insurance?
I am self employed and pay for my own health insurance. A friend of mine, who is 3 years older describes her health insurance and deductibles and pays about 1/3 what I pay and gets so much more from it.I don't know if the company matches or just deducts her premium. I have a high deductible and it just doesn't seem to cover much. My almost $500 per month versus her $158 per month seems out of line with what we both get. I bought mine through an agent.
Why can't self employed people be grouped together by area, by agent to receive some kind of discounted group rate? This would give the insurance company an agent to work with that understands and can do the paperwork (whereas companies pay a dept of people for that, so it makes sense that companies get a break for doing part of the work in it), allow some kind of discount for people and maybe more people could afford and would get their own health insurance.
I didn't realize that it had been tried 20 years ago. At that time I was insured by a company policy.
I rarely get sick. I do my yearly exam things and have a cold about once a year and my premium has quadrupled anyway.
From the below explanation it almost sounds like those of us out on our own as freelancers and self employed are lumped into the sickly, uninsurable group. With changing business and economy and people losing jobs, this group is getting larger and larger and we're not all sickly.
Comments on Why do individuals pay so much more for health insurance?
Start an insurance company.
Because health insurance is one of those insurances, where pretty much EVERYONE files claims EVERY YEAR. On average, we spend about $8,000 per person, every single man, woman, and child, in the USA.
If people filed as many car accident claims as they did health claims, car insurance would be that much.
If friend has insurance through her employer, the employer is picking up a large chunk of the tab – on group plans, employers usually pay at least HALF the cost.
The reason your discount group rate thing won't work, is called 'adverse selection' – the only people who would JOIN your group, are the people who can't get cheaper insurance on their own. If, for example, I could get insurance for $200 a month, why would I join your group and pay $350? If your group rate averages out to $350, the only people who would join, would be ones who are paying more than $350. Then the group rate would jump up to $500. Would YOU join a group where the average rate was $800 a month? No, because it's cheaper on your own.
Those self groups, are nothing except huge spirals upwards, of sicker and sicker people. Sorry. It was done about 20 years ago, and that's what happened.
That is part of the debate going on now. If your employer provides a group plan, they generally get a "group discount" from the insurer, plus the employer usually pays a portion of the employee's premium, so the employee is not directly funding the full cost of the insurance.