Many people have never had to shop for health insurance. An employer often provides it. But if you have to buy health insurance on your own, it’s important to understand the process.

What is individual health insurance?

Individual health insurance is coverage you purchase on your own, directly from an insurance company or insurance agent* (versus group insurance, which you typically receive through your employer).

If you’re an early retiree, self-employed or on COBRA, you can purchase major medical health insurance to help protect yourself and your family against health care costs and get access to care. You pay the entire premium each month; your employer makes no contributions.

How is my medical history reviewed?

With individual health insurance, you are not guaranteed coverage, which is unlike an employer’s plan. Based on your current and past health, it’s possible to be declined, or offered coverage at a higher premium.

On your application, you’ll be asked to submit medical information. Your application will then pass through the insurer’s “medical underwriting” process, which evaluates the costs of insuring you and determining if you’re eligible for coverage. Then you’ll either be accepted, denied or accepted with a “preexisting condition” waiting period before a current or past health condition can be covered. You may also receive coverage at a higher-than-quoted rate due to pre-existing medical conditions.

Can I keep my doctors?

Quality individual health insurance lets you visit any doctor or hospital you choose, without a referral. Note, however, that you’ll pay less out of your own pocket if you see doctors and hospitals in the insurer’s participating network.

It’s helpful to choose an insurer with a large, nationwide network of doctors and hospitals. This ensures when you travel, you’ll have access to participating doctors and hospitals.
Quality individual health insurance lets you visit any doctor or hospital you choose, without a referral. Note, however, that you’ll pay less out of your own pocket if you see doctors and hospitals in the insurer’s articipating network.

Many insurance companies offer a choice of major medical plans, some with prescription coverage and some without. Based on prescriptions you take now or have taken in the past, you may be offered coverage at a higher-than-quoted rate, or possibly be denied coverage.

Be sure to check how an insurer covers preferred, non-preferred and generic prescription drugs, because plan details may differ.

Can I cover my dependents?

Quality individual health insurance may allow you to add a dependent spouse and/or dependent children up to age 26 to your policy.

Unlike employer-based plans, individual insurance requires each family member to go through separate “medical underwriting,” which evaluates the costs of insuring and determining eligibility for coverage.

What is a Health Savings Account?

A Health Savings Account, or HSA, is a tax-advantaged account that helps cover your current and future medical expenses. It is designed to be combined with a High-Deductible Health Insurance Plan.

An HSA has three tax advantages: You and/or your family members make contributions to your HSA tax-free. That money earns interest tax-free. And withdrawals you make for medical expenses are tax-free. Any money you haven’t used at the end of the plan year rolls over to the next year. You never lose it because you own your HSA. If you are 55 or older (until you enroll in Medicare), you can make additional catch-up contributions to your HSA. When you open an HSA (typically from a financial institution that offers these types of accounts), you pair it up with a HighDeductible individual health insurance plan that is specifically designated as “HSA-compatible.”

There are many health coverage options available. You might have insurance through an employer. Or you might start your coverage with InsFilings. Either way, knowing the basics will help you to get the most out of your health insurance coverage.