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Mark V. Pauly and Robert D. Lieberthal How Risky Is Individual Health Insurance? Health Affairs, May/June 2008; 27(3): w242-w249. [Abstract] [Full Text] [PDF] [Statistical Appendix] [Reprints & Permissions]

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How Risky Is Individual Health Insurance?

Don N. Levit   ( 6 May 2008 )

How Risky Is Individual Health Insurance? 6 May 2008
Don N. Levit, Consultant Self-Employed Send letter to journal: Re: How Risky Is Individual Health Insurance? donaldlevit{at}aol.com Don N. Levit	I am curious what the author attributes to the high rates of turnover in the individual market. My experience with others who are active in the group market is that employers, generally, do not honor individual policies that new employees may bring in lieu of group insurance. In other words, employers will not subsidize individual policies that employees may already have before working at their new employer. Also, many insurers will not recognize individual policies in calculating their minimum participation requirements. Why do you think insurers have not devised insurance to make it more likely for people to maintain coverage, especially when they transition into high-risk health status? I would think there is a market demand, in which at least one insurer would try to capture. When we look at guaranteed renewability at class average rates, it may be useful to define what is considered a "class" to the insurer. My experience in the individual market is that insurers typically block out a class by policy form, as well as by area. By closing out the block to new entrants, adverse selection normally ensues. As an anology, one's house of worship is bound to close, if new members are not encouraged to join.