Heath Insurance, in general, is utilized to help defray the cost of services charged by doctors, hospitals, imaging centers, laboratory testing facilities, and prescription drugs. A monthly charge (premium) is levied to maintain the coverage in force for when the benefits need to be accessed. There are group and professional association plans that are available for members or employees of firms, which guarantee coverage can be placed, regardless of the health status of anyone in the group or association. Individual/family plans (IFP) are available to those who may not have access to participation in a group scenario. Presently, individuals and family members who apply for IFP plans are not guaranteed acceptance until qualifying via a medical screening process conducted by the underwriting departments of the particular insurance carrier to whom the application for coverage has been submitted. Once accepted, insureds are guaranteed coverage, regardless of the number of or dollar volume of medical claims submitted, individually, to the carrier as long as premiums are maintained in a timely manner and the carrier still offers the plan (and like plans) in the state. If a carrier were to cease operations, thereby no longer offering coverage, an insured would then lose the insurance.

The statement that group insurance coverage is less expensive (regarding monthly premiums) than are IFP plans, is not always true. In cases of plans offered by very large employer groups (more than 500 employees), it is generally accepted, but when compared to small group (50 or fewer employees) plans and guaranteed issue association plans, IFP coverage is often lower in premium. Since IFP plans are not “guarantee issue” as are small group and association programs, the insurance company knows what it’s dealing with on a medical risk basis for everyone who applies. If the applicant does not meet underwriting standards set by the IFP carrier, that carrier does not have to accept the applicant for coverage, thus knowing it is not “buying” claims as is the case with guaranteed issue programs.