What Factors Affect Michigan Individual Health Insurance?
When looking for individual health insurance plans, several factors must be considered before selecting a policy. There are the differences between HMO and PPO categories of plans, the level of out of pocket costs (annual deductibles and co-pays), and the financial strength of the insurance provider to consider. But, possibly, the most important factor to impact your coverage is the health insurance company's practices on medical underwriting of new applicants.
The medical underwriting requirement for individual health care policies is very different from what happens with group health care programs. In accordance with the law, in a group insurance plan, there should be no discrimination in coverage levels applied to any individual in the group based on that member's health status. In contrast, for individual insurance plans, discrimination as a result of an individual's health status is actively performed now and is totally legal! If a new applicant for an individual health benefits plan has a disability or existing medical condition, the insurance company is free to deny insurance to the applicant or may offer only coverage that excludes the health disability or condition.
This practice occurs because of the necessary medical underwriting of each new health insurance policy which applies to the majority of new policies purchased in the individual insurance marketplace. What the concept of medical underwriting really means is that the health insurance company is analyzing the potential financial risk under the proposed policy due to the health status of the individual. When applying for new health coverage, consumers should call the medical underwriting staff of the insurance company early in the process to learn how they treat various health issues.