Individual health insurance -- often touted as an alternative to employer-based group coverage -- may be an option for the healthiest and wealthiest. But a study due out today suggests that the poor and sick need not apply.
The overwhelming majority -- 89% -- of working-age adults who shopped for health coverage in the individual market over the last three years were rejected for health reasons or found it too expensive, according to the study by the Commonwealth Fund, a private foundation that sponsors independent research on health and social issues.
Coverage was not affordable for 58% of the applicants, and 21% who had a medical condition were turned down, charged a higher premium or sold a policy that excluded the existing problem from coverage, the report said.
Individual insurance also is less affordable than employer-sponsored coverage, the study found. Two out of five people with individual coverage spent 5% or more of their income on premiums, compared with one out of seven people with employer coverage.
The study is the latest assessment of individual insurance, which is seen as an increasingly important form of coverage as employers drop health benefits for workers and their families because of the cost.
Most of the increase in the number of uninsured Americans -- who now total, by some estimates, 46.6 million -- was because of a decline in workplace coverage, said study author Sara Collins, an executive at the New York-based foundation.
"Although the individual market is a last resort for those shut out of employer-sponsored coverage, it is by no means a safe or secure haven for everyone," Collins said.
America's Health Insurance Plans, an industry group, took issue with the study and its methodology -- a telephone survey of more than 4,000 consumers -- saying their impressions were not as reliable as the trade organization's survey of insurance companies last year. The group also pointed out that its survey showed that 16 million people had individual health insurance and that the policies they purchased were more affordable than the Commonwealth report suggested and with richer benefits than employer-sponsored coverage.
"Many people shop all the time, but don't always buy," said Mohit Ghose, a spokesman for the industry group.
He said individual insurance "may not be for everyone, but, for a certain person, it's an important choice."
