Of course insuring “sick” people ultimately drives up Group rates. This causes the actual group rates much higher than Individual rates, but because your employer is paying a significant portion of the cost, it is often perceived that group rates are cheaper.

Insurance companies will review your medical history & prescription usage and do one of the following;

1.) Raise rates

2.) Put permanent exclusions on certain pre-existing conditions

3.) Decline you all together

This ultimately keeps the people with more severe medical conditions off these types of plans and enables only the healthier people on them. Consequently because of this; rates are much lower (as insurance companies use your actual claims to derive what the rates are).