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Individual Health Insurance Question & Answers

2016 January 23
by Sarah Fields

Lisa asks…

We are itemizing our medical expenses for 2007, can we prepay our health insurance premiums for 2008?

We are itemizing our medical expenses for 2007 due to exceeding the 7.5% of AGI for medical expenses. Can we prepay my wife’s individual health insurance premiums for 2008, so that I get credit for them in 2007? The 12 month amount would be ~$1300 and will be paid for with aftertax dollars. We should not be itemizing next year. Thanks.

Sarah Fields answers:

The information in IRS Pub 502 Medical and Dental Expenses disagrees with the previous answers given:
Future Medical Care
Generally, you cannot include in medical expenses current payments for medical care (including medical insurance) to be provided substantially beyond the end of the year. This rule does not apply in situations where the future care is purchased in connection with obtaining lifetime care or long-term care of the type described at Lifetime Care—Advance Payments or Long-Term Care, earlier under What Medical Expenses Are Includible.

The above would indicate that you cannot prepay for an entire year and deduct it the previous year.

This rule is consistent with the rule that businesses, even with accrual accounting, cannot deduct prepaid insurance of any kind.

Carol asks…

Is it better options to get health insurance individual?

I looking for individual health insurance policy.Is this idea is good.

Sarah Fields answers:

Group policies are typically less expensive, but you’ll be restricted to what the group has already chosen.

George asks…

Can you apply for multiple individual health providers at the same time?

Applied for individual health insurance and got a counter offer with a 25% increase in the price than offered due to past medical history. Now, I want to apply to several other health insurance providers, but wonder if if the health providers will know what my offer through BCBS was; and simply match it. Don’t want to waste time trying to follow an empty trail.

Sarah Fields answers:

The other insurance companies won’t know and don’t care what the offer from BCBS was. Insurance companies cannot change their rates based on what other insurance companies do. Insurance rates are set and approved by the state long before you apply.

Hopefully you have an agent that also works with other insurance companies. The agent can speak with the underwriting department of each of the other companies and will have a good idea of what those companies will do in your situation. Some companies do not increase the rates on some of their plans where they will on others. Some companies do not increase but instead will waiver the condition. The agent will be able to find out without you having to waste your time.

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