What’s Individual Health Insurance?

Via InsureBlog, I came across this disturbing press release from Aetna:

As hundreds of thousands of individuals lose their jobs each month and the unemployment rate rises to 8.1 percent, one of the primary issues facing laid off workers and their families is what to do about health benefits. According to a recent survey from Aetna (NYSE: AET), consumers have a low awareness and understanding of an important option - individual health insurance plans - and also have misperceptions about the cost of COBRA coverage.

The survey found that 69 percent of consumers had never heard of individual health insurance plans or did not know much about them. While general awareness of COBRA plans was higher, 38 percent of respondents said they expected to pay the same premiums as when they were employed.

In fact, the typical cost of COBRA coverage is 102 percent of the total premium, which is the actual cost of the plan and not just the amount an employee has deducted from his or her paycheck. Without an employer contributing a portion of the premium payments, paying double or more is not unheard of for an individual to keep the same coverage.

(emphasis added)

Granted, folks who are employed and participate in employer-subsidized plans usually have little reason to think about buying health coverage on their own…but it’s a telling sign of just how entrenched in the American psyche the concept of employer-provided health insurance has become.

Of course, the press release is really just a veiled advertisement, seeking to remind readers that (if they’re in good health), Aetna might have an individual health plan available at lower cost than COBRA coverage…but still I find the statistic an interesting testament to public obliviousness on certain subjects.