What's the difference between group and individual coverage?
Who is this for?
If you're transitioning from employer-sponsored health insurance to buying your own health coverage, you'll find this information helpful.
Health insurance provided to employees by an employer or by an association to its members is called group coverage.
Health insurance you buy on your own—not through an employer or association—is called individual coverage.
Those are the basics. But what does it mean for you if you're changing from group coverage to individual? What will be different for you?
Group vs. individual coverage
If you've had employer-sponsored coverage, you're probably used to certain things. Your employer may:
- Give you a choice of health insurance plans
- Pay for all or some of your monthly premium
- Deduct your share of your premium from your paycheck each pay period
- Provide your plan documents
- Answer questions about your plan
If for some reason you can't get coverage through your employer anymore, you'll still need a health plan. For many people, that means buying individual health insurance. To learn more, see Is individual insurance right for me?
Unlike traditional employer-sponsored insurance, now you'll:
- Shop for and choose a plan that covers you and your family
- Purchase your plan
- Make all monthly premium payments
- Get to know and manage all of your health coverage and benefits
You'll probably notice differences in what benefits are covered by group versus individual plans, too. That changes on Jan. 1, 2014. After that, all health plans for individuals and businesses with fewer than 50 full-time employees will cover the same 10 essential health benefits. But if your employer has 50 or more full-time employees, they have more say in what your plan does and doesn't cover.
We have a website for members who are transitioning from group to individual coverage. You'll find more information and answers to questions other people have had.