The purchase of health insurance reduces the risks and unpredictability inherent in a consumer’s health care expenses. The consumer pays for a health insurance policy and then is subsequently (partly) reimbursed for his or her future expenditures on health care.
Consumer Purchase Health Insurance : A consumer may obtain health insurance from an employer (or other group) or individually from another source.
- From an Employer or Other Group: Some consumers obtain health insurance plans offered by employers to their employees and their employees’ dependents as fringe benefits.9 When employees obtain health insurance through their employer, the cost of the health insurance plan often is shared between the employee and theemployer.10 In addition, other groups whose members share a common bond, such as labor unionsand some other associations, can offer members an opportunity to purchase health insurance through the group.
- Not from a Group : Consumers who are not offered or who do not purchase group insurance may use insurance brokers and agents, including web-based brokers, to learn about health insurance plans.13 Brokers and agents are licensed by the states and generally are paid on commission by insurers. Agents work with one insurer, whereas brokers can work with more than one insurer.