Individual health insurance is a lot cheaper than group health insurance because companies can cherry pick applicants--- typically young and health people with no medical history.

Once you get insurance, if you're lucky enough to get it, it's guaranteed renewable. As long as you pay your premium.

As good as that sounds, there's a big "gotcha" that a lot of people don't know about.

Companies generally sell a specific plan for several years. They sell it to lots of low-risk customers. When too many claims start coming in (due to increased age, etc.), they close the plan. Nobody new can enter the pool. Premiums start to increase dramatically.

At this point, people who are still healthy and without any claim history will be offered a new policy by the same company, moving them into another "cheap" plan. They do so in order to keep those customers who don't file claims because if they didn't offer a new plan, such healthy people would move to a competitor plan.

That leaves "unhealthy" people in the old plan. Those people cannot get a new individual health insurance policy from anyone. While their insurance is still guaranteed renewable, their rates will skyrocket, as they're lumped in only with "sick" people. People who cannot afford drop out; others who have perhaps only marginal problems also drop out because it's too expensive versus their risks. Typically only the most severely ill are left in the plan, after a year or two.

This policy is called "death spiraling" and it's the way the systems work in most states.

While it's easy to blame the insurance companies-- and they do after all push for these policies in the state legislatures-- it's also true that they must do whatever makes economic sense in a given jurisdiction's laws. If one company didn't do the "death spiral" practice (when others did), they'd quickly go out of business. The individual health insurance companies aggressive compete with each other in most states.

The lesson is-- in the long run, individual health insurance doesn't work, unless you never get a condition or illness until age 65.