For most people, the option to enroll in a family plan seems like the obvious choice.  After all, it only makes sense that a bundled plan that covers an entire family would be more cost effective than individual policies. For the most part that is true, but there are some complications to insurance regulations that may make individual policies the smarter choice in some situations.

Individual vs. Employer Coverage

In 2013, the number of Americans who obtained health insurance through their employer topped 155 million, making it the most popular form of coverage in the nation. While many of these plans cover spouses and dependents, that may not always be the case.  More employers are reexamining their plans to see if they can eliminate unnecessary expenses, and one of the more appealing cuts is to extended coverage. One survey found that more than half of all employers are planning to reduce coverage options for family members by 2018.

Although the Affordable Care Act of 2010 requires that employers with 50 or more employees offer health coverage to employees and their children, there is no legal requirement to cover spouses.  Many employers intend to continue offering spousal coverage, but only if the spouse is not covered under their own employer health plan.

The ACA also stipulates that the health coverage must be affordable, but this only applies to the employee’s plan, not the spouse or dependents. Presently, many larger companies are willing to insure employee families and pay a large portion of the premiums, but many industry analysts expect that to change in the coming years. Presently, about a third of employers impose a surcharge on spousal coverage, but one survey found this could rise to 60 percent of all employers in the next three years.

For many couples, it makes more sense for the unemployed spouse to find another health insurance option rather than pay a spousal surcharge for coverage through a spouse’s employer.  This is especially true if the spouse purchases a health plan from one of the Obamacare marketplaces and qualifies for a government subsidy. These tax credits can reduce monthly premiums by up to hundreds of dollars, but you must meet some eligibility criteria including an income requirement. In 2018, you must make between 100 and 400 percent of the federal poverty level, or between $16,460 and $65,840 for a couple, to qualify for the Obamacare subsidies.

Obamacare Reshapes the Health Insurance Landscape

Whether you support or oppose it, the Affordable Care Act dramatically changed health insurance in the United States.  Before 2010, insurers could deny you coverage, inflate pricing, or offer you less benefits if you were unhealthy, but the ACA eliminated that kind of discrimination. So if you purchase a health plan—on or off the Obamacare exchanges—you will get a similar amount of coverage to other consumers at that price.

While insurers cannot modify their plan if you are sick, you should still take that into consideration when deciding on a health plan. If you or your spouse is likely to incur a large number of medical expenses, then you should keep in mind that many health plans impose an annual deductible before paying out.  Some family plans will only pay out if a large amount of out-of-pocket fees are already paid by the policyholder first.  This annual deductible for a family plan is usually significantly higher than that of an individual plan.

So, if you want your insurer to start covering bills sooner for one family member it may be wiser to get an individual plan with a lower annual deductible for him or her. You may also want to get a separate policy if one spouse needs to see more specialists that may not be covered in a narrower network policy. This may not be necessary if you enroll in a top-tier health plan with minimal out-of-pocket expenses, or if you have supplemental health insurance that covers deductibles.

Other Government Programs

If one of your family members is eligible for a government insurance program, it is usually advisable that they enroll and the rest of your family obtain coverage through other means. One of the most popular government insurance programs is, of course, Medicare.  Medicare is only available as an individual plan, so even if you and your spouse are over 65 and eligible for enrollment, you may only do so individually.  There are usually significant financial benefits to enrolling in Medicare and other governments, so any family members that are eligible should enroll as soon as possible, even if there may be any financial penalties for the remaining family members on their private policies.

Medicaid and the Children’s Health Insurance Program offer insurance to low-income, disabled, pregnant and minor Americans. Although entire households may qualify for some of these programs, in other cases, only select members may enroll in others—and perhaps only for a limited amount of time.  Once again, it is usually in your best interest to enroll any eligible family members as soon and as long as possible, even if there is a greater financial hardship on the remaining members.

Getting Reliable Advice

If you are like many Americans, you probably aren’t sure if a family plan or individual plans are right for you, and if a change is necessary, what the ideal strategies are for your family.  That is why you may wish to seek help from a trusted insurance professional.  The most commonly found insurance professionals are insurance agents and insurance brokers.  While both types may offer sound, reliable advice, you should know that insurance agents are employees of insurance companies so they will often push plans sponsored by their employer.  On the other hand, insurance brokers are not directly paid by insurers—although they do make commissions off of sold policies—but are professionally responsible for protecting the interests of consumers.  If you are looking for the ideal insurance plan for your family, you will find it at Boost Health Insurance.