Performance Improvement 2008. How Risky is Individual Health Insurance? Where Do Individuals Obtain Health Insurance?


This study examined the extent to which persons moved from one insurance status to another over time, including being uninsured. Among those who had insurance, those with individual or small group insurance were more likely to become uninsured in the following year (17 percent and 13 percent respectively) than those with large group insurance (6 percent). Even those who had large group coverage had some risk of becoming uninsured (6 percent), perhaps because premiums became too high, or they become too ill to work and lost their coverage.

Non-group plans provide health insurance coverage to a significant portion of the non-elderly population. Subsidizing the purchase of such policies at the State (e.g., Massachusetts), or Federal level is one approach to reducing the number of uninsured. One obstacle is the high proportion of premium revenue consumed by administrative expenses. The study analyzed several consumer health surveys to better understand who has health insurance coverage, and how key elements, such as health status and premiums paid, vary by type of insurance.

Although non-group (individually purchased) insurance is less common than employer-provided insurance, increasing such coverage through tax credits is one potential approach to health care reform. Most non-elderly persons who have health insurance obtain it through their employment or through a family member´s employment, and the poor sometimes are covered through public programs. About 17 million persons under age 65 in 2006 had coverage through an individually purchased private policy.

Report Title: How Risky is Individual Health Insurance?
Agency Sponsor: ASPE-ODALTCP, Office of Disability, Aging, and Long-Term Care Policy
Federal Contact: John Drabek, 202-690-6443
PIC ID: 8647

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"PerformanceImprovement2008.pdf" (pdf, 1.29Mb)

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