Wall Street Journal examines group health insurance policies as option for uninsured

People who no longer have health insurance because of a job loss, voluntary retirement or other reasons have begun obtaining health coverage through the "little-known" option of group coverage, the Wall Street Journal reports.

According to the Journal, the option is especially beneficial for people with pre-existing conditions to whom some insurers deny coverage. Federal law requires group policies to cover pre-existing conditions provided a person has not been uninsured for more than 63 days.

To qualify for group coverage, an individual, a couple or a small group of people must provide evidence of ownership of an actual business, which could include freelance, contract or consulting work. Industry experts note that rules vary between states. In addition, group coverage could cost more than individual coverage, according to the Journal. The Journal reports that insurance companies might add extra fees for smaller groups. The smallest groups, sometimes of two or three people, can face surcharges of about 30% more than what larger groups pay, according to insurance broker Rick Martin.

According to the Journal, it is unclear how many business owners currently are eligible for group coverage. Data from the Kaiser Family Foundation indicate that about one-third of the four million uninsured U.S. residents between ages 55 and 64 are self-employed, the Journal reports (Greene, Wall Street Journal, 5/27).