Do any companies offer affordable health insurance plans?

The question of whether or not there are companies that offer affordable health insurance plans is one with no easy answer. The problem lies in the fact that what constitutes affordable is different among different groups of people. For someone making in excess of $100,000 a year a $15,000 policy might be very affordable, while for someone making $50,000 a year that same policy is a lot more financially taxing.

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According to a Bloomberg report from September 2011, the average cost of a family health care plan in the United States was approximately $15,000. That represents a 9% increase over the previous year. Divided into monthly installments that amounts to about $1,250, most of which is absorbed by employers if they offer health insurance plans to their workers.

Cost to Your Employer

How much does my employer actually pay?  Based on statistics from 2010, the Kaiser Family Foundation estimated the employer contribution for the average health care plan amounted to 73%. Based on annual premium of $15,000 your employer would be paying $10,090 per year or $912.50 every month. Your contribution would amount to $4,050 annually or $337.50 every month.

Whether or not that’s affordable for you depends on your monthly income, and the rest of your budgetary expenses.

The interesting thing about these numbers is the fact that many employees don’t ever take the time to consider how much their employers are paying for their group health insurance coverage. It’s easy to complain every January about not getting a raise in pay, but when health insurance goes up by 9% it is costing your employer that much more money. You’re still getting a raise, it’s just coming in the form of your health insurance premiums.

Self-Employed

What if I am self-employed?   Among all individuals who are uninsured or on government subsidized insurance, the U.S. Census from 2010 indicates nearly 40% of them are self-employed. The reality for such self-employed individuals is that most of them work alone or employ family members rather than outsiders. Because they do not generate enough income to both sustain their business and provide health insurance for their families, most either go without for apply for government program.

Fortunately, there are trade groups and professional business organizations around the country that work with self-employed individuals to band together for a more affordable group health insurance plan.

This type of arrangement doesn’t necessarily make health insurance easily affordable for all self-employed members of the group, but it can reduce annual premiums substantially. In the absence of a trade group or professional organization some self-employed individuals find their health insurance through their local chamber of commerce.

Alternatives

Are there any alternatives to standard health insurance plans?  You’ve probably seen internet or television advertisements for low cost or discounted health insurance plans. Consumer Reports Magazine suggests you be very cautious about plans advertised as such. While it’s not outside the realm of possibility to find a quality, discounted health insurance plan, most are only able to offer low prices because their coverage is so limited. For example, you may find a family plan that only costs you a couple of hundred dollars a month, but it may only cover routine doctor visits. Any sort of catastrophic illness would leave you paying your bills entirely on your own.

By the same token, Consumer Reports also cautions consumers to be wary of discount medical and prescription cards. Such cards are great tools for individuals who pay for their own health care out of pocket. But make no mistake, they are not health insurance plans by any stretch of the imagination. Discount cards are nothing more than a creative marketing tactic designed to encourage consumers to purchase their healthcare services and prescriptions from a network of providers who have signed on to the deal.

Cost Sharing Plans

Finally, there is the option of a health coverage cost-sharing plan. These types of plans typically unite groups of individuals, usually based on a common religious belief, for the purpose of sharing one another’s health care expenses. Monthly contributions are significantly less than a standard health insurance plan so they are very affordable. However, be aware that there’s never a guarantee all of your healthcare bills will be paid.

Unfortunately, the reality of health insurance in the United States is that it is very expensive. It is just one of the costs associated with our daily lives- no different than car insurance, homeowners insurance, or life insurance.

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