Copyright 2006 Lisa IpIf you are a sole proprietor or small business owner and
require health insurance for you or your employees, there
are many options available that will provide coverage for a
reasonable premium. You will, however, be required to carry
out a good amount of research before finding an insurance
company that will suit your needs, as there are a lot of
choices out there. In addition, you have to ensure that the
company you choose for your health insurance coverage
provides the kind of plan that will be most beneficial in
times of greatest need.
Individual Health Insurance
Individual health insurance is coverage intended for one
person. If you are self-employed or run your own business,
you don¡¯t have access to a group health insurance plan
through an employer, and must purchase your own coverage
from one of the many health insurance providers located in
your state.
There are some pitfalls to obtaining your health insurance
from the private sector. For instance, limitations exist
that might make it difficult to derive guaranteed benefits
from a private insurance policy as an individual. Private
companies have a right to ask you for information regarding
your current and past health, and are also allowed to
reject you for insurance purposes based on your health
status, or impose limitations on your coverage.
Blue Cross Blue Shield, on the other hand, is required by
law to sell individual health insurance to any resident
regardless of health status. This is referred to as
guaranteed issue. They must also refrain from charging you
more due to any current or preexisting conditions ¨C this
is called community rating. HMOs are also required to sell
health insurance to any individual during the 30-day open
enrolment period that occurs each year.
Individual health insurance policies can vary depending on
the company. There are no laws that force private companies
to offer the same health insurance products so coverage
plans from different providers can offer quite different
coverage. But certain benefits for health insurance must be
provided in the coverage, including mammograms and diabetes
care.
Group Health Insurance
For small employers (2-50 employees) group health insurance
plans are a good idea if you want to provide adequate
coverage for yourself and your small group of employees.
According to guaranteed issue, insurance companies must
sell small employers small group insurance under most
circumstances. If you and your group fall within the
participation requirements you cannot be turned down. An
employee is considered insurable if he/she works for you a
minimum of 24 hours a week on a regular basis ¨C this
includes household workers.
Usually a group health insurance plan requires that a
certain percentage of your employees participate in the
plan and you might have to contribute a minimum percentage
of their premiums. Luckily, guaranteed renewability makes
it so that you cannot have your coverage cancelled if one
of your workers becomes ill. This is definitely a plus so
you always have access to continuous group coverage and are
never left by the wayside without the proper insurance.
HMOs and Blue Cross Blue Shield, again, are prohibited by
law from charging more due to the health status of one or
more employees. At the same time, private companies are
allowed to charge higher rates if they deem it necessary.
In addition, someone who is self-employed with no other
workers may be able to purchase small group health plan
coverage from Blue Cross Blue Shield. Specifically, sole
proprietors are given the option of buying ¡°group-of-one¡±
policies from this organization. Other insurers also offer
this type of coverage but are not required to offer it. You
are a sole proprietor if you: are a resident of your state,
work at least 30 hours a week and gain at least 50% of your
taxable income from your business.
In addition, self-employed individuals can have 100% of
their health insurance premiums deducted from their federal
income tax. If you are a member of a professional or trade
association you might be able to receive group coverage
under the organization¡¯s insurance umbrella.
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Lisa Ip is president of Uniforce Insurance Service, which
she founded in 1994, in Madison Heights, Michigan. For more
information regarding health insurance in Michigan, visit
http://www.uniforceinsurance.com or call 888-302-RATE
