Affordable Healthcare With Preexisting Conditions

The majority of Americans are covered under some type of group insurance policy. As of 2007, approximately 162 million Americans under age 65 received coverage through employer-provided insurance policies. This figure comprises approximately 62 percent of the population. Approximately 71 percent of workers between the ages of 18 and 64 had employer-based coverage in 2007, according to the Employee Benefit Research Institute. However, for individuals who cannot qualify for group health insurance, finding affordable health care is an ongoing challenge, with many individuals unable to obtain coverage at all.

Group Health Insurance

• Group health guarantees health care coverage to everyone within a qualifying group, including individuals with preexisting conditions. The risk is spread across all the members of a group, including those with preexisting conditions, lowering the overall cost to insurers. Insurers frequently offer lower rates for group policies than for individual policies.

  Employers often pick up some or all of the cost of premiums for their employees, further lowering the out-of-pocket expense for individual employees or households. This benefit ends when the employee leaves the company. The employee remains eligible for group insurance coverage under the Consolidated Omnibus Budget Reconciliation Act, or COBRA. However, the employee must pay the entire insurance premium. The subsidy provided by American Recovery and Reinvestment Act ended in May 2010, according to the United States Department of Labor.

Group Health Insurance Alternatives

• In the United States, groups are often made up of workers employed by a single company or by a corporation. However, groups may also be composed of membership organizations such as unions or affinity groups. United States federal law mandates that insurers must offer group health insurance to everyone included in a particular group on a "guaranteed issue" basis, regardless of the size of the group. Groups of two to 50 are eligible for "small group" health insurance coverage. Some states also allow self-employed individuals to obtain guaranteed-issue health insurance as a "group of one," according to StateHealthFacts.org. Small group policies offer a possible alternative for individuals with preexisting conditions.

Individual Health Insurance

• Individual health insurance policies do not have a "guaranteed issue" mandate. Insurers decide whether to grant or deny coverage on the basis of underwriting or calculating the risk that the applicant will file a claim for a significant health problem while covered by the policy. Preexisting health conditions may be excluded for a specified period or time or permanently. Individual health insurance policies traditionally have higher premiums than group health insurance policies.

High-Risk Health Insurance Policies

• High-risk insurance policies are traditionally offered by individual states to allow individuals with preexisting conditions who cannot qualify for group or individual health insurance to obtain health care coverage. As of 2010, the federal government began administering the Pre-Existing Condition Insurance Plan, or PCIP, with some states offering equivalent plans. The subsidies offered for these policies represent a significant savings over traditional high-risk health insurance. PCIP is intended to bridge the gap for so-called uninsurable individuals until the Patient Protection and Affordable Care Act takes full effect in 2014.