Self-employed can buy insurance now-- if they've got $$
By Carol Gentry
8/21/2008 © Florida Health News
August in Florida: hot, muggy, one storm after another. But there’s one thing to recommend August; it’s the only month that self-employed Floridians can buy “group” health coverage. It’s the only time of the year that they can’t be turned away because they’re too old or too risky.
For a few short weeks, sole practitioners, independent contractors and others who lack the benefits that a bigger company may offer can be a “Group of One” for insurance purposes.
This year, thanks to Tropical Storm Fay, the open-enrollment period for “Group of One” coverage has been stretched to Sept. 15. State Insurance Commissioner Kevin McCarty issued the extension in an emergency order on Tuesday, along with one that relaxed rules on refilling prescriptions.
The one-life group program forces carriers to sell policies to customers they don’t want: the over-60 crowd and those who have health problems. But the customers have to have a fat wallet; carriers can charge them 50 percent more than they’d pay if they were in a traditional small group, spokesmen for the Office of Insurance Regulation said. (Small groups are generally thought of as those with two to 50 members.)
Pinellas County underwriter John Sinibaldi, who used to see quite a few applicants for one-life groups each August, says he hardly ever gets any these days because the plans have become unaffordable. "The few we've quoted in the past two years have been so outrageously priced that the business owners ran screaming from the room," he joked.
“People get sticker shock," agreed Bob Lotane, spokesman for the Florida Association of Insurance and Financial Advisors in Tallahassee. "But if you haven't been able to get insurance elsewhere, it is a good thing."
Group of One policies are pricey because carriers tend to limit the offering to the “standard” and “basic” policies that have become outmoded, Sinibaldi says. In addition, state law allows the carriers to charge the one-life groups 50 percent more than the rates they have filed with the state. By comparison, an ordinary small group would have to be given a quote that’s within 15 percent limit of the rate on file.
Sinibaldi offered this example he encountered with one of his customers, a 62-year-old woman: She would have paid $1,157 a month under the Group of One plan, but because she was part of a two-person group she could get the same plan for $656 a month.
The number of Floridians enrolled in a one-life group was 32,330 in 2006, according to a report last year by the Florida Health Insurance Advisory Board. That's a drop of almost one-third, from more than 89,000 in 2001, according to the report, based on data from the Office of Insurance Regulation.
To qualify for Group of One, Floridians must be legitimately employed in a trade or business from which they derive an income. They will have to show documentation, such as tax returns or corporate statements, to prove they represent a legitimate business.
The list of carriers that must accept applications for Group of One are listed at the DFS web site.
--Carol Gentry can be reached at 727-410-3266 or Carol.Gentry@FloridaHealthNews.org.
