Most working adults shopping for individual insurance turned down or found it too costly

Of working-age U.S. residents who sought individual health coverage in the last three years, 89% were rejected for medical reasons or felt that the available plans were unaffordable, according to a study released last week by the Commonwealth Fund, the Los Angeles Times reports.

The study is based on findings from the Fund's most recent biennial health insurance survey, which includes responses from 4,000 U.S. residents interviewed by phone. According to the survey, 58% of respondents who applied for individual coverage found the health plans unaffordable. Twenty-one percent of those who sought individual coverage were rejected, charged a higher premium or were offered a policy that excluded coverage for a specific health condition they had. The study also finds:

• Two in five people with individual coverage spend at least 5% of their incomes on premiums, compared with one in seven who have employer-sponsored coverage;
  
  
• More than half of people with individual coverage pay at least $3,000 annually in premiums, and about one-third paid at least $6,000 annually;
  
  
• One-third of people with individual coverage have to pay $1,000 out-of-pocket each year before coverage takes effect;
  
  
• People with individual coverage tend to have higher levels of dissatisfaction with their health plans than those with other types of coverage;
  
  
• People with individual coverage are more likely than those with other types of coverage to report that they went without needed health care or prescription drugs because of prohibitive out-of-pocket costs; and
  
  
• One in five people with high-deductible health plans have taken on credit card debt to pay medical bills, compared with 8% of people with lower-deductible plans.

Comments

Study author Sara Collins, a senior program officer at the Commonwealth Fund, said the number of uninsured U.S. residents has increased because fewer employers are offering coverage. She added, "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." America's Health Insurance Plans said the survey's methodology was less accurate than that used in its own survey of insurance companies last year. According to AHIP, individual coverage is more affordable and includes more benefits than the new survey suggests. AHIP spokesperson Mohit Ghose also said that individual insurance "may not be for everyone, but, for a certain person, it's an important choice" (Girion, Los Angeles Times, 9/14).

The report is available online. Note: You will need Adobe Acrobat Reader to view the report.