UHG’s Continuity: Product Innovation, or Sign of the Times

The New York Times reported this week that the UnitedHealth Group has introduced a “first of its kind” product: the right to buy an individual health policy at some point in the future even if you become sick. That’s right, the new product called UnitedHealth Continuity, is not actual medical insurance, but is aimed at people who may have insurance now but are worried they may lose it — and may not be able to obtain replacement insurance on their own.

Here’s how it works: It is much like the option on a life insurance policy that allows you to buy additional coverage at certain intervals without showing proof of insurability. Say that you are a 50-year-old male who lives in Columbus, Ohio, and you plan to eventually take an individual policy in which you would be obliged to pay the first $3,500 in medical bills. You would pay $32 a month for the right to eventually get that coverage — or 20 percent of a policy that now costs $159 a month.

Is that a good deal? It depends. Keep in mind that most states let insurers refuse to sell new individual policies to anyone with a pre-existing medical condition. One major illness, say a bout with cancer, and you would be hard pressed to find a individual health insurance policy – at any price.

Is it worth paying several hundred dollars a year just for the right to purchase insurance – not necessarily at a standard rate – sometime in the future, maybe? Are people that concerned that they my lose their employer-sponsored coverage in the near future?

What are your thoughts? Leave your comments below.

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