On average, Americans spend a collective $3.4 trillion a year for medical care, so it’s in our own hands to make sure we’re receiving the best care our money can buy. Finding and choosing the right individual health insurance can make all the difference to your health and household’s bottom line. It means you don’t need to pay right out of pocket and contribute to that collective figure.
While newer technologies, treatments, and drugs are enhancing our overall levels of health and wellness, the right amount of coverage for your personal situation ensures you’re only paying for what you need.
That’s why so many Americans use individual health insurance plans as a cost-effective tool for healthcare coverage. You can purchase individual health plans through a private exchange like Nerdy Insurance Agency, or opt for purchase through one of the government marketplaces. Not only do personal health plans offer more security in specific cases, but it can also be far more flexible option when compared to group plans from an employer.
Understanding Individual Health Insurance
Individual health insurance is a health plan designed to provide primary or supplemental coverage for yourself. These plans are recognized as “individual” or “personal” because you’re not relying on an employer to apply for you. Rather, you purchase health coverage on your own through a marketplace.
Individual health insurance is an ideal option for those who are either unemployed or self-employed. These plans are especially useful if you don’t have a spouse or any dependents, but you can add family members to your plan. Here are some of the benefits of individual health plans:
- This type of health coverage allows consumers like you to choose an insurance company, the plan, and the healthcare options that suit your needs.
- You may still renew or change health insurance plans during the annual Open Enrollment period.
- Losing your job doesn’t mean you will automatically be cut off from healthcare coverage because your plan is independent from your employer’s.
- Rather than having to settle for your employer’s choices for doctors and hospitals, individual health plans give you control over the doctors and hospitals you trust. This is known as a network.
- Depending on your personal or household income, you could further qualify for government subsidies to offset the cost of monthly premiums.
How Do You Qualify For A Personal Health Plan?
Qualifying for a personal health plan depends on the kind of plan you’re choosing and the source you’re opting to purchase from.
Right now, every American who is not currently covered under a health insurance plan is eligible for coverage under ACA-compliant plans as long as they enroll during the Open Enrollment period. ACA-compliant plans are plans that follow the Affordable Care Act. The only individuals who would be exempt from qualifying for ACA plans are those that are receiving Medicare.
There are three types of individual health insurance plans that you may be eligible for under the right conditions:
Primary insurance through a marketplace: Both ACA (qualified) and Non-ACA (non-qualified) plans are available to individuals. They can choose to enroll by themselves (individual) or through their employer (employer-sponsored group plans).
Short-term insurance: You can easily pick up coverage for these low-cost plans, and you can do so at any time through the year. Think of it this option as a tool to bridge a gap in your healthcare coverage.
Government-sponsored insurance: These are programs such as Medicaid or Medicare. Medicare is only available to individuals 65 and older, younger people with disabilities, and those within the end stages of kidney-failure disease. Medicaid is based on financial eligibility. Though there are quite a few exceptions, generally Medicaid is used by low income families and individuals, qualified pregnant women and children, as well as those receiving Supplemental Security Income (SSI)
For personal health plans that are ACA-compliant, consumers can buy directly from health insurance companies, through a private exchange, or head to their state’s health insurance marketplace. Note, rates for qualified plans are the same regardless of where the plan is purchased. Medical government assistance-based programs such as Medicaid, CHIP, and Medicare have their own low-income and age-specific thresholds, respectively.
There are also provisions in place for deadline extensions, but these usually involve special circumstances, such as marriage or adoption. If you’re applying outside of the Open Enrollment period, for example, you will have to qualify for Special Enrollment Period (SEP) requirements.
Personal health plans that are non-qualified (non-ACA plans) are better known as short-term health plans. These policies provide coverage until you can get onto an ACA-compliant plan, either through your individual efforts or through an employer. Although these plans are affordable, they don't cover maternity, mental health, substance abuse, or a pre-existing conditions.
How Much Does Individual Health Insurance Cost?
EHealth’s report on 2019’s numbers show that the average monthly premiums for individual coverage on qualified (ACA) health plans was $448. This was based on a Silver plan. At metal level Gold and Platinum, monthly premiums rose to $596 and $706. It’s easy to see how average premiums on individual plans for a multi-person household can easily break $1,000 per month.
Along with several essential requirements, the Affordable Care Act provides subsidies that can help reduce the cost of personal health insurance. As long as you qualify under a certain income threshold, you may receive a subsidy or tax credit that can cover all or part of your chosen plan. In 2016, for example, the average credit reduced consumers’ health insurance premiums by 73%.
On an individual health insurance plan, the average annual premium may start out at $4,632 but these tax credits can decrease the amount you’ll pay to $1,272. On a comparable employer-sponsored plan, the premium can be as much as $6,435 for one person.
Individual Health Insurance Plans
All qualified plans, regardless of the exchange they are purchased, have an annual Open Enrollment Period. This is usually between November 1st and December 15th. You can buy non-qualified plans year-round.
Option #1:
Medicare or Medicaid
The first option for personal health insurance is Medicare and Medicaid. Though consumers often confuse the two, they’re each designed for a different circumstance:
Medicare: Is a national health insurance program started by SSA, and which primarily provides health insurance for those 65 years and older. It also offers coverage for some people with disabilities.
Medicaid: Is a federal health insurance program which helps with medical costs for people with limited income and resources.
If you have Medicare, you’re not eligible for personal health insurance through the marketplace.
Option #2:
Qualified Health Plans
How you and your insurance plan split costs
Estimated averages for a typical population. Your costs will vary.
| Plan Category | The insurance company pays |
You pay |
| Bronze | 60% | 40% |
| Silver | 70% | 30% |
| Gold | 80% | 20% |
| Platinum | 90% | 10% |
If neither Medicare’s age requirements nor Medicaid’s income stipulations describe your circumstance, your next best option are qualified (ACA-compliant) health plans. These plans are designed to give you access to the most essential health benefits, which include emergency services and maternity care, to name a few.
While the exact premiums change from year to year, the percentage of payment for each of the metal plans remains the same. There are four metal plans – Bronze, Silver, Gold, and Platinum. Individuals who are 30 or younger may also opt for the Catastrophic plan to save on monthly premiums.
One of the benefits of employer-sponsored plans is that they handle all the research and heavy lifting. However, if you’re opting for an individual health insurance plan, you’ll need to take charge of the process. A smarter way to go about choosing the right individual health insurance plan is to use a certified enrollment partner such as Nerdy Insurance Agency. Nerdy Insurance Agency offers consumers both qualified (ACA) and non-qualified (non-ACA) plans. These compliant marketplaces ensure easy, transparent, and agent-guided enrollment process for consumers.
Option #3:
Non-qualified Health Plans
Non-qualified health plans are a good alternative to qualified or ACA-compliant plans because they’re less expensive and enrollment is open all year long. However, non-qualified plans have different coverage options. They may or may not offer all ten of the essential benefits that ACA plans do. These plans are still filed and reviewed by each respective state insurance department, but they do not follow the guidelines of the ACA.
Another aspect left up to the discretion of the insurers of non-qualified plans is eligibility. If you have a pre-existing condition or are currently ill, some of these insurers may outright reject your application. Once you’ve been rejected, you may need to disclose that information on other applications you fill out.
Find Affordable Individual Plans
Affordable individual health plans are just a couple of clicks away when you work with Nerdy Insurance Agency. As a federally-compliant partner in your search for personal health plans, we offer ACA and non-ACA plans for individuals who want a more convenient and transparent health insurance application process.
Our marketplace is a crucial hub for up-to-date health coverage information for the current year. Nerdy Insurance Agency also offers you the chance to go through an expedited and secure process for affordable health insurance. Visit Nerdy Insurance Agency today to speak to our live agents. We can help you understand your plan options, eligibility, and the right coverage options for you.