What Is Private Health Care Insurance?

In the United States, "private health care insurance" is insurance purchased on the open market by an individual who assumes all insurance premium costs. In many western countries, health insurance is administered only by the government. In the United States, most all health insurance companies are private companies, though health plans for the elderly and low-income are government-administered. In 2010, most insured Americans had access to a health plan through an employer.

Individually Purchased Coverage

• The cost to purchase an individual, private insurance plan directly from the provider is usually much higher than the cost of employer-based coverage. However, those directly purchasing individual coverage can customize their care in ways those covered by government- and employer-based plans cannot.

Employer-Based Coverage

• In the early 21st century, employer-based health insurance plans covered roughly two-thirds of the under-65 population. Employer-based plans are purchased through private companies, though employers are able to take advantage of large group discounts to hold down costs. Young adults, retirees and minorities are least likely to have access to employer-based coverage.

Future of Health Insurance

• 2010 saw sweeping federal health care industry reforms that promised to alter the way insurance is sold in America. While the 2010 reforms do not prohibit individuals from purchasing private, individual health plans, the law creates incentives that encourage consumers to participate in managed group health insurance "exchanges" that aim to drive down overall health care costs.