An individual health insurance plan is the most expensive of all options. Moreover, insurance companies are offering them less and less because group plans are more lucrative for them. Even COBRA, which is known to be expensive, costs less. For this reason, it is advantageous for individuals to join together.

The individual plan has several other drawbacks. One must submit to a physical examination. Once the recently-passed Obama plan goes into full effect in 2014, the insurance companies will not be allowed to refuse to cover pre-existing conditions, but until then, the old system will still be in place. Thus, you may be denied coverage for any ailments you already have which can be very costly. This practice is called adverse selection. As an individual, you likely will want to lower your premiums. The only way to do that is to sign up for a high-deductible plan. This route is smart if you are young and in good health but less so if you are in need of regular care. There are also what are called medical savings accounts whereby one saves money in a tax-free account for smaller medical bills and relies on insurance for the larger ones. Such people would use a pay-as-you-go indemnity plan. After a pre-determined amount is spent, the rest would be paid for by the insurance company. One must be careful to select a good company that does not have a history of denying or canceling coverage, as is disquietingly often the case.

The Obama plan will offer subsidies for lower- and middle-class people to offset the cost. There will be insurance exchanges where those in need can shop for the best deal and no one will be denied coverage. In 2014, there will be a $695 fine to any individual who does not purchase health insurance. Presumably, this stipulation means that, after the subsidy, health insurance is expected to cost less than $58 per month.

Until then, one can enter into a group plan through one’s employer or a membership organization. One can avoid adverse selection because the reason for inclusion in the plan is membership in a group rather than medical need. The employer usually pays part of the cost, which is considered a perk. Unfortunately, often the plans are prohibitively expensive and do not provide good coverage. In such a way the employer can nominally offer the benefit while discouraging its use at the same time. Americans, whether by choice or by circumstance, are increasingly opting for non-employer-based coverage.

The first places to look for group coverage is with various organizations, such as the local chamber of commerce, union, alumni association, social or professional association. Some examples include AARP, the Writer’s Guild of America, the National Association of the Self-Employed, the Freelancers Union, the Alliance for Affordable Services, or the Small Business Service Bureau. Mensa also offers insurance to members. Please take into account the cost of membership.

The Obama plan will make health insurance much more affordable. Until it goes into full effect, group plans are usually the best option.