Individual Health Plan Frequently Asked Questions
1. Can anyone qualify for an individual health insurance policy?
2. Will I have to wait to be covered for pre-existing conditions?
3. Are individual health policies more expensive than group health insurance?
1. Can anyone qualify for an individual health insurance policy?
A. No. Individual health insurance is not guarantee issue in the State of Illinois. The application process includes questions about your current health as well as past health history. Certain conditions may prohibit you from qualifying for a plan. Since underwriting guidelines vary from carrier to carrier the assistance of an independent agent with knowledge of the varies carriers and products can save time and frustration for those seeking a policy.
2. Will I have to wait to be covered for pre-existing conditions?
A. Maybe. Some carriers impose a pre-existing conditions waiting period of one year from the date of the policy for conditions that were treated or exhibited symptoms in the year prior to the effective date. Other carriers will cover pre-existing conditions providing they are listed on the application and not excluded by a rider.
3. Are individual health policies more expensive than group health insurance?
A. Not necessarily. The method used to determine the cost of policies in the individual market versus the group market is entirely different. Individual policies are generally rated upon the age, sex, smoking status and zip code of residence as well as the plan design. The rates are published rates with limited deviation available for certain medical conditions. A common example is a rate up in premium due to build. Since individual policies are not guaranteed issue, an applicant can be declined if their health status is not within the guidelines of the carrier. The ability to decline applicants with unacceptable risk characteristics allows for the rates of individual policies to often times be considerably lower than the rates for a similar plan design in a small group plan with health conditions present.
4. My spouse and I own our small business and don’t anticipate adding other employees. We are both in good health. Would it be less expensive to purchase a small group plan or an individual plan?
A. An individual plan will very likely be less expensive than a small group plan. Since individual plans are only offered to applicants that satisfy certain underwriting criteria, the rates are lower than the small group market that must make an offer to a small group but can increase the base rates in anticipation of potential claims.
5. My child has decided to take a semester off of college. Will this result in him/her being removed from our family’s individual health plan?
A. No. If you are insured by a health plan offered by a company domiciled in Illinois, your dependent child can remain on your family policy to age 26. The dependent child does not have to be a student or even reside with the parent. They cannot be married. If your child has served in the military and is no longer covered by the military health plan, they can remain on the family plan until age 30. This is a law specific to Illinois. Please be sure to seek the guidance of your agent in determining if the individual carrier is domiciled in Illinois to be sure of the applicability of this law.