I Want a "Group" Insurance Rate

I get calls all of the time from people on the search for a better health insurance rate and they ask me how they can qualify as a "group". The usual one I hear is that they are self-employed and their wife helps them with the books, so they want a "business group" plan. I once got a call from a guy representing a large group of independent musicians from all over Colorado and they wanted to band together into a group for health insurance reasons.

While there are several ways we can find people a "group" rate on health insurance, it's usually the worst option available. In Colorado, if you're self-employed you can typically get a Business Group of One (BGO1) policy for just yourself without even having other people in your group. The problem is that Colorado law (as well as most other states) says that group health insurance cannot be underwritten. Even better right? Well, policies that are underwritten are normally 1/2 to 1/3 of the cost of non-underwritten policies. This is because they don't have the extra expense of having to cover pre-existing conditions. Not only do they not cover pre-existing conditions like asthma, but they can completely decline people with more serious health conditions. This dramatically lowers the cost structure.

It's not uncommon that I'll meet someone who bought their first health insurance policy as a self-employed person without the help of a health insurance broker or they bought it from their P&C agent. They are a perfectly healthy person on a self-employed BGO1 policy paying nearly 3 times as much as they need to be for their policy. All because they are self-employed, so they figured they needed a group rate policy for self-employed people.

If you're ever in a situation where you need to buy your own insurance (because you're self employed or your job doesn't cover it) and you have a pre-existing condition that prevents you from getting an underwritten individual/family policy, CoverColorado may be able to help. Colorado is just one of many states that has a risk pool. If you are a self-employed individual needing coverage only for yourself, a BGO1 will probably work well. But if you have dependants, and you or one of your family members needs a guaranteed issue policy because of a serious pre-existing condition, the most cost-effective solution may be to put that person on a CoverColorado policy, and get an underwritten policy to cover the rest of the family. That way you're only paying the guaranteed issue "group" price for the person who needs it, rather than the whole family.