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Is Essential Health Insurance legitimate?

Is this a good health insurance strategy?

  • I don't have real good health good health insurance as of now. However I am able to access medical care because of a county subsidized health program. But, the benefits are extremely limited. I have used the county health program to see a doctor about problems with my right eye. several times over the last 2 years. I was told that the problems with my eye are cause by me being overweight. My last appoint to see a ophthalmologist was mid October of 2009; which was inconclusive. I have a follow up examine; on the morning of January 10th 2010. Now I want to get real health insurance and spent the last week researching the various options. Right now my only option is to get an individuals health insurance policy for a single, non smoking, 35 year old male. Based on my research, my eye problems will be excluded on any individual insurance plan as a "pre-existing condition". However, the rules for a group health plan are different and more favorable. In my state:, """A group health plan can apply a pre-existing condition exclusion period only those conditions for which you actually received (or were recommended to receive) a diagnosis, treatment or medical advice within the 6 months immediately before you joined that plan. This period is also called the look back period. … Group health plans can exclude coverage for pre-existing conditions only for a limited time. The maximum period is 12 months.""" I interpret that to mean that if I sign up for a group health plan and had sought medical advice, treatment, or diagnosis, for anything, with six months of joining the group health policy; then the insurer can apply a "pre-existing condition exclusion" for 12 months. Also, I learned through research, that it is a lot less difficult to quality for group health insurance than you might think, in my state. In fact, it seems that if you form a business entity, like a S corporation, C corporation, or limited liability company, and have at least one employee; than you legally qualify for "group health insurance plan". Now the problem I mentioned earlier I am having with my eyes may be attributable to me being overweight like that doctor said. Or you could from some unknown more serious problem. If it is more serious, then I am screwed, since there is no way I could get this covered on a individual health insurance policy without a exclusion for a pre-existing conditions. However, here is my strategy to use the state laws to my advantage to get group health insurance with this so called "pre-existing condition". He is my plan: 1) Get good health insurance now to protect myself for unforeseen health issues with the understanding that my eye problems will bee excluded as a pre-existing condition. 2) Start a home based business in the name of a legal entity like a corporation or llc. I was going to start a online business any ways. Now, I have an greater incentive. Also, hire someone as an "employee". One of my relatives will do quite nicely. This, would qualifies me for group health insurance 3) Mean while, cancel my upcoming eye examination scheduled for the 10th of January. Why? If my understanding is correct, then by law no "pre-existing exclusion" can be applied to a member on a group health plan if they have not seeked medical attention 6 months prior to joining the group health policy. As previously stated, I last went to the ophthalmologist in mid October 2009. It is now, the second week of January 2010. I calculate that by canceling my appointed to the ophthalmologist, 6 months would have passed by the end of April 2010. This will beyond the 6 months "look back period" allowed by law for pre-existing conditions to be excluded under a group health plan. Then, I can buy a group health insurance without fear of any exclusions for pre-existing conditions. Doing this is a definite gamble. This symptoms I having with my eyes get intermittedly worst on a daily basis. However, it is something I could live with for 4 mores months to get group health insurance. In addition, if I eat better, and loose weight then the problem with my eyes may take care of itself. 4) Buy, group health insurance through my home based business at the end of April or the beginning of May in 2010. I would received the substantially lower premiums offered by group health insurance. Assuming, I don't go to the doctor during the next 4 months and or the problems with my eyes does not get better; then I could join a group health, through my company, legally without a "pre-existing exclusion." What do you think of this strategy?. Any improvements or pit falls?

  • Answer:

    An undertow of the current health care debate has been the suspicion that working Americans will be forced to cover the cost of health care for deadbeats who decline to work and pay for their own. I thought it would be interesting to look, state by state, at just how many people 16 are actually in the work force as defined by the census bureau, i.e., working outside of the home or actively looking.

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You have thought a lot about this, but unfortunately, the flip side as already pointed out by others here is that group insurance would be more advisable for bigger groups since small groups do not get any discounts. It would be best to start up your insurance plan now -with the cheapest one. Hopefully, with the new changes (though there is going to be a long time before they are implemented) things might be better.

On the surface it sounds like a good strategy until you learn more about group policies. First off, group policies are not necessarily cheaper than individual plans. Group plans are perceived to be cheaper because the employer picks up a good portion of the premium. Also, your state probably mandates certain coverage you may not need, such as maternity and mental health. So even if both you and your "employee" are male you'll still have maternity coverage on the policy and your premium will be higher because of it. On a group policy you cannot decline mandated coverage. Second, groups of fewer than 10 will be individually underwritten and the premiums will be increased. Since you are overweight there is one adjustment and since you have a medical problem that will be another adjustment. When they underwrite the policy they'll look back much further than 6 months. The insurance company will set the premium so that it doesn't loose money. Third, your "employee" must be a bonafied employee. That means they must actually work in your business and be on the payroll. They must also be on the policy.

You need to have prior qualifying coverage. PLUS, you might not realize, YOU pay the premium for both you, and the relative. Also, the premium for a small group like yours, is individually underwritten - that means, it could end up costing YOU $2,000 a month, to insure both of you. You don't GET "substantially lower" premiums on a small group policy. You get "average of the health of the group members". The average group premium per person is actually higher than the average individual premium. So, I think the pit fall, is the cost - you are underestimating how much the group plan is going to cost you, for you and the employee. PLUS, you'll most likely have to provide workers compensation coverage, for you, and your employee, before a health insurer will give you group health insurance, to avoid the possibility of them picking up the cost for a work related injury.

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