Kids and Health Care: If Your Employer Cuts Back on Health Benefits

HIPAA also helps if your employer drops group health coverage. In short, the law can make it easier to get an individual health policy for your family.

Under HIPAA, you might be able to buy an individual health plan without the threat of exclusions for pre-existing conditions. In order to do so, you have to qualify as an "eligible individual." To be eligible as an individual under HIPAA, you must:

• have had at least 18 months of continuous creditable coverage;
• have been covered under a group health plan, a governmental plan or church plan (or health insurance offered in connection with such plans, such as COBRA) during the most recent period of creditable coverage;
• not be eligible for coverage under a group health plan (including a spouse's plan), Medicare or Medicaid;
• not have other health coverage;
• not have lost your most recent health coverage due to non-payment of premiums or fraud (unless your employer failed to pay premiums); and
• have elected and exhausted any option for continuation of coverage (under COBRA or a similar state laws) that was available under your prior plan.

In some states, if you qualify for individual health coverage under HIPAA, any company offering individual health plans in that state must sell you coverage. In these situations, the HIPAA individual coverage works much like a state-sponsored risk pool -- though the HIPAA will usually have fewer exceptions and exclusions.

HIPAA does not limit the premiums health plans can charge for individual family coverage. So, while your application won't be rejected because of past health problems in your family, the premiums for individual coverage can be much higher than for group plans. Also, the benefits available under individual family coverage can change dramatically from plan to plan. So, comparing plans -- both for cost and benefits -- is more important when you're buying individual family coverage. Even if you can count on HIPAA protections.