People who buy nongroup or individual insurance say their premiums have increased an average of 20 percent, according to a survey by the Kaiser Family Foundation.

This increase has spurred 16 percent of them to search high and low for a better price for the coverage they want, but they’re coming up short. Buyers who bought a cheaper policy still ended up paying 13 percent more than their original premium — and are now getting less comprehensive coverage.

The survey found that those who switched are more than four times as likely to say their new plan offers worse benefits than their previous plan (49 percent) than they are to say their new plan’s benefits are better (11 percent).

The majority of people get health insurance through their employer, but about 14 million under age 65 have coverage through the nongroup or individual market, which has come under scrutiny for steep rate increases. This market will be subject to reform under the Patient Protection and Affordable Care Act.

People with individual insurance report an average annual premium of $3,606, less than the average $4,824 reported in 2009 for employer-sponsored coverage, which is typically more comprehensive.

Insurers also typically vary premiums by age in the nongroup market, with older people reporting higher premiums than their younger counterparts, both for the individual and for family policies.

The survey notes that those who pay for their own coverage are much more likely to worry about being able to pay for health care or for a major illness than those with employer coverage:

  • Forty percent who buy their own insurance say they are “not too confident” or “not at all confident” that they will be able to pay their medical bills.
  • Only 17 percent say they are “very confident” they could pay these bills, compared to 36 percent of those with employer coverage.
  • Half of those who purchase their own coverage say they are “not confident” that they could pay their bills if they were to suffer a major illness or injury, compared with a quarter of those with employer coverage.

This lack of confidence can result in avoidance of costly care, with more than 1 in 5 nongroup insurance buyers reporting that they or a covered family member did not get needed care because of the cost.

One in five also reported not filling a prescription because of cost. And those with a pre-existing condition were twice as likely as those without to report skipping needed medical care because of the cost (31 percent vs. 15 percent) or not filling a prescription because of the cost (28 percent vs. 14 percent).

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Shelley Slade
Vogel, Slade & Goldstein

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