I’m self-employed but my spouse is able to add me to their group plan. Is that cheaper than finding my own coverage?
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Asked April 23, 2012
That depends on several factors, including your health, the laws of the state you live in, and how your spouse's group health plan is handled. In most cases, it is cheaper for both partners to be insured under a single group plan than to have premiums for two separate plans, but that is not cut in stone. You should probably compare the options carefully before making the decision, based in part on the information provided here.
If your spouse's group health plan is through her employer, the rates may be lower because the employer pays a portion of the premiums. In this case, compare what your premiums would be through your spouse's plan and then shop for other group coverage plans available to you, such as health insurance available through AAA, Sam's Club, or other commercial or civic organizations you belong to.
Your health could also be a determining factor. If you have preexisting conditions, individual health insurance may be difficult to find. Group health plans are generally required by law to accept all qualified applicants regardless of preexisting conditions, but individual plans are more limiting. The reason is that group plans rely on the power of high memberships to reduce the overall cost of providing health care, while individual plans must charge rates commensurate with the health of each member.
In 2014, federal laws will go into effect which require health insurance companies to accept applicants without bias in regards to health conditions. When this happens, it will be more important to shop around for the best rates because most of the current inhibiting factors will no longer exist. Until then, it is typically less expensive for both partners to utilize a single plan, although it is still important to compare costs. After all, if you find a health insurance plan that is less expensive than what your spouse has, you could save even more money by having your spouse switch over to your plan.
Answered April 23, 2012 by Anonymous