Health Insurance

General Information on Insurance

Most people get health insurance through group plans offered by their employers; such plans are usually paid for by the employer and by the employee through payroll deductions. Despite what some people think, employers are not required to provide health insurance for employees. However, if an employer chooses to offer health coverage, the policy must be available to all eligible employees, usually during an annual insurance sign-up period called open enrollment. Many employers offer health insurance only to full-time employees.

If, as an employee whose company offers health-insurance benefits, you do not enroll in the employer's insurance plan within 30 days of initial eligibility, the insurance company can require you to complete a questionnaire. The health statement can be used only to determine pre-existing medical conditions, not to refuse you group health insurance. Special regulations apply to health insurance offered by employers with 50 or fewer employees.

Some employers choose to pay employees' health costs instead of offering a plan from an insurance company. These plans, self-funded by employers, are called self-insured plans.

Some employers hire an insurance company, a managed-care organization (MCO), or a third-party administrator (TPA) to handle their claims under a self-insured health plan. The self-insured health plan must be available to all eligible employees, and the employer is responsible for ensuring that it is.

Self-insured health plans are federally regulated by the U.S. Department of Labor under the Employee Retirement Income Security Act (ERISA). State governments do not regulate self-insured plans.

Some fraternal and professional organizations, associations, and clubs offer group health insurance to members. Like insurance offered by employers, this health insurance must be offered at some time to all eligible members. This is called "guaranteed issue." To find out whether an organization offers health insurance to its members, contact the organization's member services representative.

If you do not have access to group coverage, you can often buy a policy for yourself and your family on the individual market. Premiums (the amount you pay each month for your health-insurance policy) vary, based on your age, family size, what the policy covers, and the area in which you live.

Purchasing an individual policy requires careful shopping because costs, benefits, and underwriting standards (the guidelines and procedures used by insurance companies to decide whether to insure you) vary.

If you apply for an individual insurance plan, you will be asked to complete a questionnaire about your health. The health statement typically requests medical information from the past five years. Be sure to fill out the health statement and application completely and accurately. You should disclose all health conditions that you have had during the past five years, including any condition for which you take medication. Be sure to explain on the form if you no longer have a medical problem.

If the insurance company sells you a policy, your application becomes part of the policy and is considered a legal document. Your insurance company can investigate and rescind, or take back, your policy for up to two years after you apply if you provide inaccurate information on your application or fail to disclose a condition occurring within the past five years.

Should you answer "yes" to any question on the health statement, an insurance company has the right to request your medical records and use that information and any other information from your application to decide whether or not to offer you health insurance, even if the information is about a condition that you had more than five years ago.

Companies generally refuse to insure people with chronic illnesses. If you have a chronic illness, you may be able to get insurance through a government insurance program.

Although a service might be ordered by your physician, the service might not be covered by your insurance plan. Please review your coverage requirements and exclusions detailed in your insurance policy. You may be billed for these non-covered, or excluded services.