How to Buy Individual Health Insurance in NY
Did you know the number of people who will buy individual health insurance is estimated to grow to 31 million by 2020?
In a recent survey by the Kaiser Family Foundation (KFF), Individual insurance is the latest and hottest trend in the insurance industry. It’s been also noted that health insurance for an individual is almost 60% cheaper than an equivalent group health insurance plan. This could be why people are opting out of group health plans and switching to individual health insurance.
How much does Individual Health Insurance Cost?
It’s a common misconception that individual health insurance is more expensive than company sponsored group health insurance.
It makes sense, right? You would naturally think with all the employees at your firm, you would be getting a discount on your health insurance premiums, when in fact, it really doesn’t work that way at all!
In 2015, the national average cost for single coverage was $346 per month and $667 per month for family coverage. In contrast, the average premium for group insurance coverage for a single was $521 per month and $1,462 per month for family coverage.
So given the huge disparity between the cost of individual insurance and group insurance, it makes sense that many employers have cancelled their group health plans and told their employees to buy their own health insurance plan. Then the employer reimburses the premium to the employee.
Wait a minute, is that legal?
Yes, it is legal for now but it’s a slippery slope with regards to the IRS. Somewhere within the 10,000+ pages of the Affordable Care Act (ACA) it deems that reimbursing employees for individual coverage carries a huge fine to the employer. But for now the IRS has yet to issue a final ruling on the practice reimbursing premiums.
If you are like many employees that have been told to get their own health insurance plan or if you are self-employed looking for an insurance plan for you and your family, here’s how to buy health insurance and avoid common mistakes that many people make.
How To Buy an Affordable NY Individual Health Plan
Let’s begin with the simplest and most basic rule of buying any insurance, don’t buy more insurance than you need.
Here’s what I mean:
When it comes to insuring your car, you probably don’t choose a deductible of $250 because you know the premium would be too expensive, right? You would probably choose a deductible of $750 or $1000 because you know that in the event of an accident, you could pay some money out of pocket.
Well, this same concept applies to buying health insurance and making your coverage more affordable. If you want the insurance company to pay every time you go to the doctor for a sniffle or ache, your premiums are going to be very expensive.
On the other hand, if you have a policy with a deductible where you pay, let’s say the first $2500 for medical care and then the insurance company pays 100%, you will save a lot of money on your premiums.
In other words, the higher the deductible you can afford, the lower your insurance premiums will be. It’s a balancing act between how much you can afford in monthly premiums and coverage that fits your lifestyle and needs.
The mistake that most people make is they don’t do the math of how much they can pay out of pocket if they have a major medical expense. We have all been conditioned over the years to think the insurance company is going to cover every procedure, every exam, every pill and every medical bill.
Unfortunately, it doesn’t work that way anymore. Just like your auto insurance, the company wants you to have some “skin in the game” – to take on some financial responsibility if you have an accident. The same concept now applies to health insurance.
Tips On Buying an Individual or Family Health Plan
Purchasing an individual health insurance policy has never been easier. There are four simple tips to follow:
1. Policies can be purchased through a licensed health insurance agent such as our company, Healthplansny. Just go to our individual health insurance page to download our rates and plans. Then call us at 914-633-1717 to discuss your options. (Note: We only represent private health plans from our major insurance companies, not Obamacare plans).
2. You can purchase a plan through the New York Health Insurance Marketplace. This can be a bit time consuming or overwhelming for many people. However, the State claims they have licensed agents available to help by phone if you run into problems. Expect long hold times.
3. Research your desired coverage level that you can afford. There are 4 “metallic tiers” to choose from: Platinum, Gold, Silver and Bronze. The Platinum plans have the least out of pocket expenses but the highest premiums. The Bronze plans have the lowest premiums but the highest out of pocket expenses for medical care.
4. Once you found a health plan that fits your needs and budget, complete the application and pay the first month’s premium. You are on your way to owning an individual health plan!
Help When You Need It
If you need help or have any questions about purchasing a health plan for yourself or for your family, please contact us at: 914-633-1717. We are licensed insurance agents and happy to guide you through the process.