Understanding Individual Health Insurance 

Healthcare in the U.S. is indeed notoriously expensive, but making health insurance more affordable will make a big difference for many people, especially those who work for themselves, are between jobs, or don’t get employer-sponsored benefits.

According to the CDC, in 2024, about 92% of Americans — roughly 310 million people — had health insurance. That’s up 6 million from the previous year.

Even so, just over 8% of the population (about 27 million) were still uninsured. For many of them, looking into personal health insurance can be a simple and straightforward way to get coverage that better fits their needs.

The good news is that the uninsured rate continues to fall, largely thanks to the Affordable Care Act (ACA). By 2025, more than 45 million Americans were enrolled in ACA coverage, accounting for nearly 12% of the US population. It’s been reported that the ACA helped cut the nation’s uninsured rate nearly in half between 2013 and 2023.

Whether you’re insured now or still weighing your options, understanding individual health insurance can help you plan ahead. This guide covers what you need to know to decide if this type of coverage makes sense for you.

What is individual health insurance?

Think of it as car insurance for your health. Health insurance plans for individuals are essentially a safety net that can be purchased independently to protect you and your family from emergency medical expenses and routine healthcare needs. This can include medical treatments, doctor visits, hospital stays, prescription medications, and other healthcare services. 

Unlike group health insurance, which is often provided as employer health insurance, individual health insurance is something you buy directly from an insurance provider. This means you’re in charge of selecting and purchasing the coverage that best suits your needs and your family members’ needs.

And just like car insurance, you pay a monthly premium to the insurance provider. By doing so, you’re essentially investing in your healthcare needs — which, hopefully, will provide a sense of security and reassurance.

What does it cover? Individual health insurance plans offer comprehensive coverage, spanning a wide range of healthcare services. Whether it’s a routine check-up, a specialist consultation, or emergency medical care, these plans aim to ease the financial burden of accessing necessary healthcare services.

Additionally, they often extend coverage beyond basic medical treatments to include preventive care, diagnostic tests, mental health services, maternity care, and more. 

How does individual health insurance work?

Individual health insurance operates on a simple principle: sharing risks. Your monthly premiums are pooled with those of other policyholders to form a collective fund that covers healthcare costs. This approach spreads the financial risk across a larger group, easing the burden of expensive medical treatments or services on any single policyholder.

Many people wonder, “What is the cost of individual health insurance?” The price varies depending on your age, health status, location, and the level of coverage you choose. Monthly premiums can range widely, but understanding your options helps you select a plan that balances cost with the coverage you need.

In return, the insurance provider commits to covering a portion of your medical expenses as outlined in the policy. This could be for hospital visits, doctor consultations, prescription medications, preventive care, diagnostic tests, and/or rehabilitation services. Coverage may vary depending on your chosen plan, with some policies providing more extensive benefits than others.

In addition to monthly premiums, individual health insurance policies often include cost-sharing terms so that you, the insured, have some skin in the game. These may take the form of deductibles, copayments, and coinsurance.

• Deductibles require paying a predetermined amount out of pocket before insurance coverage kicks in. Once met, the insurance provider typically covers a percentage of the remaining healthcare costs. At the same time, you’re responsible for the rest through copayments or coinsurance.
• Copayments are fixed fees you pay when receiving medical services, such as visiting a doctor or filling a prescription. These fees are usually standardized amounts set by the insurance provider and are intended to help offset the overall cost of care.
• Coinsurance is a percentage of total healthcare costs you must pay after meeting the deductible. For example, if a policy has a co-insurance rate of 20%, the policyholder is responsible for paying that amount, while the insurance provider covers the remaining 80% of the healthcare costs.

These structures are in place to balance affordability for policyholders with sustainability for insurance providers. They help ensure that everyone has access to essential healthcare services while encouraging responsible use of coverage to keep premiums manageable for all.hcare services while encouraging responsible use of coverage to keep premiums manageable for all. 

Why choose individual health insurance?

Here are some key reasons why getting individual health insurance may be right for you.

You can customize your plan  

One of the key advantages of individual health insurance is its flexibility. Unlike group plans, which may have limited options or be subject to the decisions of an employer, individual health insurance allows you to customize coverage to align with your specific medical conditions, prescription drug requirements, and healthcare preferences. This might include coverage options like alternative therapies, gym memberships, telemedicine services — whatever coverage you need, without paying for unnecessary services or benefits.

Plans are portable 

Since individual health insurance plans are not tied to any specific jobs, you can keep your coverage regardless of changes in employment status. This portability aspect gives you the freedom to pursue career opportunities, transition to self-employment, or go through periods of unemployment — all without worrying about losing healthcare coverage.

You have a choice of providers 

Unlike certain managed care plans that limit access to a network of providers, individual health insurance often allows you to seek care from any licensed healthcare professional without needing referrals or approval. That means you’re free to pick your primary care physicians, specialists, hospitals, and other medical facilities. By building relationships with healthcare providers you trust and accessing the medical services you need, your overall satisfaction and quality of care can improve.

Can your employer still cover your health insurance?

Even if you are between jobs or self-employed, it’s important to understand your options. Some employers may allow you to remain on their plan temporarily under COBRA or other continuation coverage programs.

However, many individuals in these situations turn to personal or private health insurance plans to maintain continuous coverage at a fair cost without relying on an employer.

Still without personal healthcare insurance? You don’t need to be.

At the start of this article, we mentioned that more than 25 million Americans don’t have health insurance. However, individual health insurance is helping to bridge the gap for people without coverage, and that number is going down. This is good news for freelancers, part-time workers, students, and others who might not qualify for group coverage through conventional employment.

Choosing individual health insurance gives you the freedom to get personalized coverage, find the best affordable health insurance, tailor it to fit your budget, and ensure it meets your needs — whatever those may be.

At The Baldwin Group, we’re here to help you find the perfect private health insurance plans or individual coverage. We’ll discuss your situation, explore options, and conduct the necessary research to identify the best plans that align with your needs and budget. 

Whether you want to kick things off with an online quote or prefer to chat over the phone, we’re here to guide you through the intricacies of health insurance seamlessly.