I have had many medical problems in my past. I've been at home raising kids and have been covered under my husband's insurance. Now he wants to quit his corporate job to go independent, and I'm hoping to take a job that will get us group insurance. I know an employer plan can't refuse me coverage. However, I understand that they can raise the premium for the whole group based on one person's high cost, even if it's just a history, not current claims. In a very small group, it wouldn't be hard for my co-workers to figure out who'd jumped the costs. When I had my last job years ago, I turned down the group insurance and paid more money to get insurance elsewhere, because I didn't want to be blamed if the group's premiums went up at the next adjustment point based on my medical information. Do I still have to worry about this possibility, or has the system changed?

Ann

If you get a job that offers health insurance benefits, you have the same right to that health insurance as all of your co-workers. To worry about whether they will blame you for an increase in their premiums is your choice. But my advice is this: Don't worry -- be insured.
Much has changed in recent years regarding group insurance. Federal and state laws have created a new and different environment for employer-based insurance. First, a federal law passed in 1996 requires all small-group health insurance to be offered on a guaranteed-issue, whole-group basis. This means that insurance must be issued to any employer group that meets the federal definition of a small group (two to 50 employees), and no single employee can be omitted from the plan. Prior to this federal law, some states had already passed guaranteed-issue, whole-group laws. Now that it is the law of the land, the process of underwriting has changed. Obviously, it is less rigorous, and applications have become much simpler.

At the same time many states made group insurance guaranteed, they also took steps to regulate the rates charged for small-group insurance. Before such laws went into effect, the premium rate for each group was based largely on the health and claims experience of that particular group. After the rate regulations went into effect, there was considerably more "cross-subsidization" between all the groups insured by a particular carrier. In these states an insurer cannot vary the cost from group to group by more than, say, 25 or 50 percent. This means that the insurer must average part of the cost across all employer groups rather than strictly with a certain group. This decreases the effect that one person's claims would have on a particular group.

Here is another factor that should ease your concern a bit. Rates for group insurance are established on an annual basis. In other words, if the insurance plan year begins in January, new employees added to the plan during that year would have no effect on the per-employee premium. What happens next is not as obvious as you think. Let's say you had claims in your initial months of employment. Depending on the size of the group, your claims would have to be fairly substantial to affect the premium rate assessed at the next renewal date. And what if your co-workers or their dependents had claims? What if there was a complicated pregnancy or heart surgery? Those might raise the group rate, and you and your co-workers might have no idea whatever that these things had happened. It seems unlikely, in the event of a price increase, that your co-workers would single you out for the blame.
So the bottom line is this. The system has changed considerably in the past few years, and I believe that it would be difficult for any member of an employer group to assign blame for a rate increase to any other employee. Unless you post your medical chart on a bulletin board and your co-workers do the same, it is unlikely that they will have any knowledge of your situation.

While this is not precisely germane to your question, here is a word about confidentiality. Privacy is a major concern for many people today. We've been scared by some policymakers and members of the media into thinking that our complete medical history is just a mouse-click away from public view on the Internet. But this is not the case. Your medical information is confidential, and what little is required on a group insurance application is strictly guarded. It is not shared with your employer, and is used by the insurance company solely for the purpose of risk management. There are many regulations and sound insurance practices that protect sensitive information.

Health insurance is a valuable benefit for many employees. Having it is much better than not having it. If you get a job with health insurance benefits, do the right thing and take it.