Being a self-employed individual in the United States is sometimes a bigger pain than it is a blessing. At tax time, you feel it the most. You can see the discrimination between you and a corporate employee making the same hourly compensation as you by simply comparing your tax return amount to his or hers. They always seem to make out better than you. It’s the same with health insurance. Work for a big company, and you’ll get the best health insurance rates possible, but apply for health insurance for individuals and your wallet will surely wince! The exorbitant premiums you must pay will more than likely keep you from getting insured. This fact has been taken into account by the new Health Reform Law, and now the Feds are doing something to make health insurance affordable for you.

Health insurance for individuals is expensive simply because you aren’t bringing  any business to the insurer but yourself. Like other products for sale, the greater the amount you purchase, the cheaper the cost per item charged. Because large corporations can bring more business to insurers, they are given the best premium rates per employee. It’s as simple as that. You can’t blame the insurers. After all, health insurance is a business, not a humanitarian undertaking. Numbers are important to their bottom line, as it is for any business. The more they sell, the greater the profits. As a lone wolf, you’ve had to face the fact: alone, you’ll pay the most.

In its Health Reform Law, the federal government undertook bringing affordable insurance to all Americans. Recognizing that many self—employed people were uninsured because of the price tag on health insurance for individuals (as well as for small businesses), the framers of the law saw fit to include a requirement that aims to bring insurance cost for the ‘lone wolf’ down to the same price as the corporate man or woman now pays. In the near future, health insurance for individuals will be available at group rates. This will be made possible by the proposed health insurance ‘exchanges’.

The concept of health insurance exchanges is a brilliant solution to the inequity the self-employed individual now endures. These exchanges will be available throughout the country. Each exchange will represent a pool of many thousands, perhaps millions, of people up for health insurance. At each exchange, health insurance providers will make their products available, and the number of people  in a given exchange will be treated as a group, just as the employees of a corporation are treated as a group. The people who will belong to the exchange will be owners of small businesses and the self-employed (or unemployed) individual. Being a part of a group, these individuals are no longer required to pay premiums at their highest rates. They’ll get them at group or exchange discounts.

If you’re a self-employed individual looking for medical insurance, you’re in luck. Shortly you’ll be able to purchase health insurance at attractive corporate rates. It makes you wonder if the government, having done this, might not soon turn to the inequities in the tax code that penalize self-employment. For now let’s be happy we can finally get health insurance for individuals at affordable prices. We can be healthy and live!

Tags: health insurance for individuals

Who hasn’t heard a story of a health insurance provider who refused to pay on a  legitimate claim just to increase the provider’s profits? With every claim paid, their profits decrease. Yes, it happens, but then, bad apples are found in every  industry, from Wall Street to Main Street, from City Hall to the Capital. The question is how widespread the practice is, and there’s no telling. Still, we  shouldn’t paint the entire industry with the same brush. The health insurance industry has as many honest companies as any industry. Still, the U.S. Congress has put constraints on the industry in the new Health Reform Law of 2010 that should  help alleviate this industry of some of its embarrassments.

The health industry accounts for fully one sixth of the United States economy! Americans spend $2 trillion a year on health care, most dollars coming from health insurance providers who, of course, collect their money as premiums on health insurance policies. Health insurance providers make 3 to 6 percent profit from their premiums; the rest goes to operations and claims payments. The new Health Reform Law of 2010 has now put providers on notice: by 2011, providers must allocate at least 80 percent of premium payments to treatment. They’ll be forced to operate on 20 percent of their collections and extract their profit as well. This measure is intended to force providers to streamline their operations, control their expenses, and to reduce tendencies to deny claims. In the future, we can be assured, our providers will pay all legitimate claims without too much fuss. Good news indeed.

Health insurance providers have been saddled with additional burdens as a result of the passage of the Health Reform Law. After March 23, 2010, when President Obama signed the bill into law, providers were to immediately cease the practice of dropping a person’s coverage just because they get sick. Neither are they to deny coverage to sick children. In 2010, they are also ordered to remove lifetime caps, enabling the elderly sick to continue receiving care. The first year insures the sick will be able to get treatment, and that no one covered by insurance be denied when they need it most. Following this law, the health care insurance industry will no longer be open to accusations of inhumanity.

As said above, 2011 will require health insurance providers to spend 80 percent of their premiums on medical treatment. It is in 2012 that the industry will experience the full force of the law, as then, no provider will be permitted to refuse insurance to any U.S. citizen. They’ll have to make insurance available to everyone, sick or not. While this could prove an unfair burden as new claims from the sick will increase their payouts, the law has balanced this possibility with an equally binding force requiring all Americans to have medical insurance. Since insurance for the about 24 million poor Americans will be subsidized by $350 billion from the U.S. government, 2012 should see health insurance providers realize an increase in profits.

All of these measures are meant to control health care costs in the U.S., to provide all citizens access to insurance, and to assure the sick always have care. If all goes as planned, we can expect to see the reputation of health insurance providers at all time highs. Given what they do provide for society, that reputation should have always been high. Getting rid of those ‘bad apples’ should  renew our confidence in them again, with heartfelt gratitude.

Tags: health insurance providers