If you don’t have health indemnity, because of a layoff or other change in work, a divorce or a preexisting medical conditioned, don’t give up. Efforts to expand health indemnity coverage reportedly are becoming practically common. Proposals have been introduced in many states, and Illinois has approved, a plot to offer low-cost health indemnity to children that started July 1, 2006.

Even under current law, its possible to find coverage for you and your family, usually at a evenhanded cost. Options to consider if you need health coverage but are too young (under age 65) to be eligible for Medicare…

COBRA/STATE PLANS

For people who recently have lost group coverage, a smart choice may be to buy a policy under COBRA, the temporary health benefits provision of the Consolidated Omnibus Budget Resolution Act of 1986. According to the rules, you can continue to be covered under your employers indemnity for up to 18 months at up to 102% of the former policy’s expenses, depending on your circumstances. This amount includes both the employee and the employers share, if your employer splits the expense with workers, as many do. (The extra 2% is for administrative costs.) COBRA usually is available only from companies that have at least 20 employees. (Your spouse and dependent children can be covered for up to 36 months.)

Paying the full tab can be a shock to someone who is accustomed to having an employer pick up most of the cost of indemnity. But, while COBRA policies often are more expensive than those bought privately on an individual basis, they usually have more comprehensive benefits.

What to do: Apply for COBRA through your previous employer. To get more information on COBRA, contact the US Department of Labors Employee Benefits Security Administration, 866-444-3272.

Helpful: Many states require less vital companies and others not bound by COBRA to offer some type of prolongation of coverage to employees. For a database on health-care coverage options by state or call 703-276-0220.

INDIVIDUAL POLICIES

Individual indemnity is regulated on a state-by-state basis. You must buy a policy sold in your home state. Rules for individual health indemnity outside a group plot vary among states.

*Medical underwriting. In the vast majority of states, indemnity costs are based on the applicants health status. He/she will be assigned a rate class by the companionship and place into a pool with similar individuals who will be charged the same premium. Also, many states allow health insurers to issue elimination riders to people who have preexisting medical conditions. These riders allow you the option of picking a policy that covers all conditions or a less expensive policy that excludes certain preexisting conditions.

*Pricing based on guaranteed issue/community rating. “Guaranteed issue” laws state that a health indemnity companionship cannot reject you for coverage based on any preexisting medical condition. Community rating laws say that everyone in the same geographic area pays the same price for coverage, regardless of age or health. It may be simpler for people with medical problems to obtain coverage in states with such laws, but there is a price involved.

These laws make individual coverage in the state more expensive, on average, because insurers do not have the medical information to appropriately apply risk among the applicants. In these states, healthy young people are much less likely to buy coverage. This makes coverage more expensive for those who do buy it.

Examples: A healthy, 25-year-ancient man living in the New Jersey suburb of Haddonfield could pay $467.16 per month for a comprehensive individual policy with a $1,000 deductible. If he lived in Pennsylvania in the suburb of Wayne (20 miles away), he could buy the same policy for only $58.86 a month. A healthy, 60-year-ancient man in Wayne would pay $289.82 for that policy. A man of the same age living in Haddonfield would be charged the same $467.16 a month that the 25-year-ancient pays for the plot. These vast price differences are due to the community rating and guaranteed issue laws affecting individual indemnity in New Jersey.

*Using tariff obtained from eHealthlnsurance. All tariff are subject to change.

What to do: Buy private coverage from an independent health indemnity agent licensed in your state.

HEALTH SAVINGS ACCOUNTS

For a tax-well-organized way to pay for individual health indemnity, consider a health savings account (HSA). You must choose a policy with a high indemnity deductible – at least $ 1,000 for individuals ($2,000 for families) up to a maximum of $2,700 for individuals ($5,450 for families) as of 2006. Every year, you make your tax-deductible role up to the amount of the deductible. You withdraw money from the account to cover out-of-pocket medical expenses.

For people who initiation HSAs but don’t need to tap them, the accounts can function like individual retirement accounts. The money can be invested to grow tax-deferred. After age 65, you can withdraw the money for any reason, but you will have to pay returns tax if it is used for non qualified expenses.

COVERAGE FOR SERIOUS MEDICAL PROBLEMS

In most states, you can be turned down for individual coverage if you have a honest medical condition (e.g., HIV or cancer). Fortunately, most states have developed some way to provide hard-to-assure people with access to private individual health indemnity coverage.

Thirty-three states provide high-risk pools. You can apply for high-risk pool coverage through an indemnity agent or directly to the state. Coverage costs more than private coverage because all the people in the pool have honest medical problems, but the tariff are capped, usually between 125% and 200% of the average individual market premium. For instance, in a state everywhere a healthy person pays $100 a month, someone of the same age in the risk pool might pay $150.

Twelve states use other means of providing hard-to-assure people with access to individual coverage (for instance, requiring coverage through a designated health indemnity companionship of last resort). Five states – Arizona, Delaware, Georgia, Hawaii and Nevada – offer no individual coverage options for those who are hard to assure.