Group Health Plans

With group health insurance, a single policy covers the medical expenses of many different people, instead of covering just one person. Unlike individual insurance, where each person's risk potential is evaluated to determine insurability, all eligible people can be covered by a group policy, regardless of age or physical condition. The premium for group insurance is calculated based on the characteristics of the group as a whole, such as average age and degree of occupational hazard. The employer may pay for part or all of the insurance cost (premium). Group health insurance covers student organizations, professional associations, religious organizations, employers and other groups.

When an employee leaves a job he or she may be eligible for continuous health insurance as a result of the Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA). This federal law protects employees and their families in certain situations by allowing them to keep his or her health insurance for a specified amount of time. The individual must however pay a premium to keep their insurance plan in effect. It is important to note that COBRA only applies under certain conditions, such as job loss, death, divorce, or other life events. The COBRA law usually applies to group health plans offered by companies with more than 20 employees. Some states have laws that require employers to offer continuous health care coverage for people who do not qualify for COBRA.

Apply for Group Coverage

Although your individual health is generally not evaluated when you apply for group health insurance, you must apply during the specified eligibility period. For employer-sponsored health insurance, this is often the first 90 days of your employment, or the first 30 days following your initial probationary period. For association insurance, this may be the first 30 days of your membership in the group.

If you fail to enroll during this period, the insurance company has the right to treat you as though you were applying for individual insurance. This means you will probably have to answer extensive health questions, and go through a physical examination. The insurance company can then decide whether or not to insure you.