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Where
Do You Get Insurance
Group
Insurance
Most Americans get health insurance through their jobs or are
covered because a family member has insurance at work. This is
called group insurance. Group insurance is generally the least
expensive kind. In many cases, the employer pays part or all of
the cost.
Some employers offer only one health insurance plan. Some offer
a choice of plans: a fee-for-service plan, a health maintenance
organization (HMO), or a preferred provider organization (PPO),
for example. Explanations of fee-for-service plans, HMOs, and
PPOs are provided in the section called Types of Insurance.
What happens if you or your family member leaves the job? You
will lose your employer-supported group coverage. It may be possible
to keep the same policy, but you will have to pay for it yourself.
This will certainly cost you more than group coverage for the
same, or less, protection.
A Federal law makes it possible for most people to continue their
group health coverage for a period of time. Called COBRA (for
the Consolidated Omnibus Budget Reconciliation Act of 1985), the
law requires that if you work for a business of 20 or more employees
and leave your job or are laid off, you can continue to get health
coverage for at least 18 months. You will be charged a higher
premium than when you were working.
You also will be able to get insurance under COBRA if your spouse
was covered but now you are widowed or divorced. If you were covered
under your parents' group plan while you were in school, you also
can continue in the plan for up to 18 months under COBRA until
you find a job that offers you your own health insurance.
Not all employers offer health insurance. You might find this
to be the case with your job, especially if you work for a small
business or work part-time. If your employer does not offer health
insurance, you might be able to get group insurance through membership
in a labor union, professional association, club, or other organization.
Many organizations offer health insurance plans to members.
Individual Insurance
If your employer does not offer group insurance, or if the insurance
offered is very limited, you can buy an individual policy. You
can get fee-for-service, HMO, or PPO protection. But you should
compare your options and shop carefully because coverage and costs
vary from company to company. Individual plans may not offer benefits
as broad as those in group plans.
If you get a noncancellable policy (also called a guaranteed renewable
policy), then you will receive individual insurance under that
policy as long as you keep paying the monthly premium. The insurance
company can raise the cost, but cannot cancel your coverage. Many
companies now offer a conditionally renewable policy. This means
that the insurance company can cancel all policies like yours,
not just yours. This protects you from being singled out. But
it doesn't protect you from losing coverage.
Before you buy any health insurance policy, make sure you know
what it will pay for...and what it won't. To find out about individual
health insurance plans, you can call insurance companies, HMOs,
and PPOs in your community, or speak to the agent who handles
your car or house insurance.
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