For many, the day you become your own boss is a dream come true. You get to make all the decisions. You’re in total control! But there are occasional moments when being self-employed can also feel a little heavy. Every part of your dream business is now up to you to figure out.
All of it.
Including health insurance.
Most people rely on an employer for their health insurance benefits, so now that you’re the boss, how can you find quality, affordable insurance options?
Don’t worry, we’ve got your back.
Let’s walk through several self-employed insurance options to make sure you and your family are protected.
Short-Term Options
Whether you’re doing part-time freelance work, or you’re only planning to be self-employed until you find full-time employment, here are some short-term health insurance options.
- Short-Term Health Insurance: temporary coverage for those transition periods of life such as a job change, or loss of employer-covered insurance. This type of insurance usually covers you for up to three months. Though that initial coverage period may be extendable, it’s not a viable option for long-term coverage. Short-term health insurance does have some helpful benefits, for example, you can sign up outside the normal enrollment period, and your monthly premiums may be lower than some other options. The downside to short-term health insurance plans is that pre-existing conditions usually aren’t covered, you may have higher out-of-pocket expenses, and typically, the out-of-pocket expenses incurred while a short-term plan is in effect do not transfer over to the out-of-pocket maximums that must be met on a permanent health plan. You should take into consideration if you can comfortably hit two separate out-of-pocket maximums in one calendar year if it were to be necessary.
- COBRA: or the Consolidated Omnibus Budget Reconciliation Act, is an option that allows you to keep your previous employer’s health insurance plan for between 18 to 36 months. Many people choose to continue their employer coverage through COBRA even though the premium payments are often significantly higher than they were as an employee because your employer is no longer helping to pay for it. It’s a good option to eliminate the hassle of searching for another insurance plan during a temporary transition period, but for a permanent solution, it’s highly likely that you can find more cost-effective coverage elsewhere.
- Professional and Trade Organizations: Certain groups offer industry-specific health insurance plans based on a trade, profession, or membership organization. Members of the group share the cost of the medical insurance. If you’re part of a group or organization that might have health insurance benefits, do your research and find out if it’s a good fit for you. If you aren’t part of a group currently, there are groups available in several states just for self-employed individuals that we partner with.
Long-term Options
If your plan is to stay permanently self-employed you’ll want some long-term health insurance options. Here are some good places to start for small business owners.
- Public Health Insurance: The Health Insurance Marketplace is the government’s health insurance site where you can search for plans that best suit your personal circumstances and determine if you qualify for assistance such as Medicaid, tax credits, lower premiums, or CHIP (Children’s Health Insurance Program). Insurance through the marketplace is required to provide certain types of coverage, and all individuals must be approved for coverage without limitations on pre-existing conditions. If you’re healthy, public health insurance may not be the best option for you because you may end up paying for coverage that you don’t need or paying a more expensive premium than necessary based on your own personal health history.
- Private Health Insurance: any health insurance offered by private insurance brokers, agents, or companies. Private insurance plans cover a wide range of coverage, cost, and benefits. You can research plans on your own, but often an agent has an understanding of how to navigate the system and find the best plan to meet your needs. Easy Affordable Health Insurance has access to a large private carrier network and we can customize private plans to help you make sure you get all of the coverage you need and don’t pay for any of the coverage you don’t.
- Health Care Sharing Ministries: HCSM’s are cost-sharing organizations open to people who share religious or ethical beliefs. The members pool their money into a fund and use it to pay for the group’s major health care expenses. This arrangement may have benefits for some people, but be aware that HCSM’s aren’t regulated like public and private insurance plans, and may limit what expenses are paid for.
- Self-Insure: a risk-management strategy where an individual or company sets aside funds to be used to pay medical expenses. While this technique seems tempting because of the upfront cost savings, it carries the risk of not having enough money pooled in the event of significant illness or injury and is an option that should not be considered lightly.
Listen, Boss. You’ve got a lot on your plate. Trying to decide on a health insurance plan shouldn’t eat into your already busy schedule.
Let us help. You keep being the expert at what you do best and let us handle the insurance. It’s what we’re here for.