The Basics of Private Health Insurance
In the United States, health insurance is one of the most important ways someone can invest in their future. Our healthcare system practically requires it – and now that COVID-19 is on all our minds, insurance is becoming a hot button topic for many people.
For most Americans, health insurance is tied to employment; a company purchases a health insurance policy, and its employees are covered while they work for the organization. But – as many discovered during the COVID-19 pandemic – this also means that you can lose your insurance if your company lets you go for any reason. This uncertainty is why a growing number of people are turning to private health insurance to cover themselves and their families.
What is Private Health Insurance?
Simply put, a private health insurance plan (also known as non-group insurance) is a policy that you purchase for yourself or your family to cover your healthcare expenses. In 2018, approximately 43 million Americans used a private insurance policy to cover their healthcare needs. These individuals have many reasons for seeking private insurance: they are self-employed, unemployed, or unable to get adequate insurance from their employer.
How Does Private Insurance Work?
Private health insurance functions just the same as employer-based insurance. Your insurance policy will determine which doctors are in your network, which services are covered, and how much your co-pay will be. When you go to a doctor, dentist, or any other healthcare service, their office will bill your insurance for your visit. Then, the insurance will cover the appropriate portions of your bill and invoice you for the remainder.
The biggest difference between private and employee-based insurance is how your pay for your coverage. Instead of enrolling under your employer’s policy (and having your company deduct your monthly premium from your check), you pay your premium directly to the insurance company – the same way you would pay a utility bill.
Where Do You Get Private Insurance?
There are many ways to purchase private health insurance. However, the most common methods to get private insurance are:
- Affordable Care Act (ACA) Insurance: Also known as Obamacare, this marketplace offers low-cost insurance plans
- Medicare: This insurance policy is exclusive to individuals 65 and older with qualifying disabilities
- Short Term Health Insurance: Most people purchase short term insurance when they are in between jobs and need temporary coverage
- Healthcare marketplaces (like My Private Health Insurance): These companies can offer you varying healthcare policies based on your budget and your coverage needs
Each of these methods can provide you with the health insurance coverage you need. The one you use is entirely dependent on your needs, your current health (e.g., do you have pre-existing conditions that might exclude you from some policies?), and your budget.
If you decide to purchase through a marketplace – whether it’s the ACA marketplace or a site like My Private Health Insurance – you’ll be able to view several different policies based on the type of coverage you and your family need. You can choose between various healthcare policies, vision policies, dental policies, and much more.
The marketplace allows you to compare cost and services covered, ultimately giving you the power to choose the health insurance that is best for your family. With private insurance, you can choose the coverage that best suits your unique health needs and ensure that you and your loved ones are always well-cared for.
The Pros and Cons of Private Insurance
Like all things in life, private health insurance is far from perfect. There are certain drawbacks that can make this type of insurance seem scary or unattractive to the average person. Therefore, many people prefer to stick with their employer’s insurance policy – at least with that plan, the boss deals with all details! Some of the biggest drawbacks of private health insurance include:
Premium Costs Can Be High
When your employer buys large group health insurance, the premium cost is split up between all the employees in the organization. As a result, the total cost per employee tends to be lower than your typical private insurance policy. With private insurance, you bear the entire brunt of your coverage cost, with means higher premiums than you might be used to.
Pre-Existing Conditions Can Be a Problem
Oftentimes, employee-based insurance policies have special clauses in their contracts to allow for employees with pre-existing conditions. This allows individuals with disabilities or chronic health problems to receive health care coverage. However, when you purchase a private insurance policy, it is not always easy to get coverage for a pre-existing condition. Insurers can turn individuals away in some cases due to their current health status.
While these issues can be enough to turn some people off private insurance, there are also many benefits that come along with a non-group plan. These include:
Freedom to Pick the Plan You Want
When your health insurance is covered by your employer, your coverage is determined by your employer’s decision. Because of this, you may not get the coverage you need (for example, vision or dental) to adequately take care of your healthcare needs. Private insurance allows you to choose your insurer and your specific coverage, so you always have the plan that makes you the healthiest you can be.
Private Health Insurance is Portable
As many people discovered in the wake of the COVID-19 lockdowns, losing a job can often mean losing your health insurance. This can be devastating for many; if you suffer and injury or illness while unemployed, you’ll get stuck with a massive hospital bill! Private insurance continues to cover you if you pay your monthly premium. If you move to a new city, leave your job, or start your own small business, you and your family are still covered! This can give you incredible peace of mind.
Whether you are self-employed, unemployed, or simply not satisfied with your current healthcare plan, private health insurance is a great way to get the coverage you need to take care of yourself. Visit our website to learn more today.