No employer plan? What to do

WASHINGTON — If you don't have an employer plan:

The first step is to begin educating yourself about the health insurance market. A good place to start is a Web site run by the Georgetown University Health Policy Institute, Click on your state, and you can get summary information on consumer protections and what private insurers may and may not do.

Then think about what kind of insurance you need. In general, experts say, you should focus on protecting yourself against ruinous medical expenses and worry less about having your routine expenses paid.

"It's better to buy comprehensive benefits with a high deductible as opposed to first-dollar (coverage) with limited benefits," said Karen Pollitz, research professor at Georgetown's Health Policy Institute.

You should also look for a policy that is renewable at your option. Many people, especially young adults expecting to take a job soon, buy temporary policies for, say, six months, figuring that's all the coverage they'll need. But this a risk.

"The problem with temporary policies is that they are temporary," Pollitz said. "If you get a job, fine, but if you don't, you are forced to renew. If you've had no claims, you can renew. ... But it's a six-month policy, and if you get hurt after four months, it pays the bills for two months. Then it's not renewed, and now you're really screwed."

You should also look carefully at internal caps and limits the policy may have. What is the lifetime maximum the policy will pay? "Ideally there should be no limit, but $2 million should be the absolute rock bottom to accept," said Nancy Metcalf of Consumers Union. "Anything lower and you're really putting yourself at risk."

But then there is the question of the premium. To get a sense of the range for someone in your situation in Oregon, the Web site offers a wide range of price quotations, and you can get some details on policies.

You may want to consider an "HSA-compatible" policy, which has high deductibles but allows you to put aside an equal amount in a tax-deductible health-savings account that is tax-free if used for medical expenses. Such plans work best if you are healthy — no chronic ailments, for example — and in good enough financial shape to fund the HSA account.

In addition, Consumers Union's Web site includes a worksheet for policy comparisons. That one's at; click on "health care" at the bottom, then on "health insurance," then "individual policies," and finally on "Consumer Reports: Plan cost and coverage worksheet."

Finally, if you find a policy that looks good, will the insurer sell it to you? In most states, that's up to the insurer. "The medically underwritten market can be very difficult to enter," said Pollitz, adding that she has heard of people being turned down for such seemingly minor ailments as acne and hay fever.

Different carriers have different rules, of course, so shopping around may get you over this hurdle. But perhaps not. If you're refused coverage, ask your state insurance regulator if there are companies offering "guaranteed-issue" policies for which you can't be turned down. The drawback, though, is that such policies tend to be very expensive.

There are really only two sure-fire solutions in today's individual market, said Metcalf: "Be healthy or be rich."

Share This Story