The End of Employer-Provided Health Insurance: Why It's Good for You and Your Company

Chapter 2The Advantages of Individual Health Insurance

An individual or family health insurance policy is a policy purchased from an insurance company covering you and selected family members. The terms individual policy, family policy, individual and family policy, and individual or family policy all mean the same thing—a policy purchased by a consumer directly from an insurance company covering an individual or a family.

It works just like car insurance. With individual health insurance, the risk is spread over a large group of people—hundreds of thousands, even millions, depending on the plan and insurance company.

Today, individual coverage is almost always better and costs about half the price of comparable employer-provided coverage. Moreover, most American families earning less than $100,000 a year are eligible for a federal subsidy to pay for individual health insurance—but only if their employer does not offer employer-provided coverage. The amount of the subsidy depends on income and family size and pays monthly, on average, about half the price of individual coverage—making individual coverage after the subsidy about one-fourth the price of comparable employer-provided coverage.

Your employer's health insurance broker and your employer's health insurance company may not want you to know this.

Your employer may also not want you to know this for several reasons—employers need healthy employees to participate in their employer-provided plan, and employers with more ...