Navigating health insurance as a self-employed individual can seem daunting, but with the right approach, it becomes manageable. Unlike traditional employees who often receive health insurance through their employer, freelancers and entrepreneurs must secure coverage independently. The good news is that there are several options and strategies to find the right plan.
- Marketplace Health Insurance
A key resource for self-employed individuals in the United States is the Health Insurance Marketplace, created under the Affordable Care Act ACA. The Marketplace allows you to compare plans based on coverage options, premiums, and deductibles. You can enroll during the open enrollment period, which typically runs from November to mid-December, or during a special enrollment period if you experience certain life events like moving or a change in income. Marketplace plans are categorized into four levels: Bronze, Silver, Gold, and Platinum, which vary by premium cost and out-of-pocket expenses. If your income falls within certain limits, you may also qualify for subsidies or tax credits that can make your monthly premiums more affordable.
- COBRA Coverage
If you have recently left a job where you had employer-sponsored health insurance, you may be eligible for COBRA Consolidated Omnibus Budget Reconciliation Act coverage. COBRA allows you to continue your existing iSure group insurance benefits broker plan for up to 18 months. However, one downside of COBRA is that you will have to pay the full premium yourself, which can be expensive, as it often includes the portion your former employer was paying.
- Short-Term Health Insurance
If you only need temporary coverage, short-term health insurance may be a good option. These plans typically cover unexpected emergencies or accidents rather than routine care. They are often more affordable but come with limited coverage and are not required to meet ACA standards. Therefore, they might not include essential benefits like preventive care or prescription coverage.
- Health Savings Accounts HSAs
If you choose a high-deductible health plan HDHP, you can open a Health Savings Account HSA. Contributions to HSAs are tax-deductible, and withdrawals for qualified medical expenses are tax-free. HSAs can be a valuable tool for self-employed individuals looking to manage healthcare costs, especially if you do not have many medical expenses throughout the year.
- Professional Associations
Some self-employed individuals find that joining a professional association related to their industry can help them secure group health insurance rates. Many associations offer access to health insurance plans at discounted rates or provide additional resources for navigating the complexities of healthcare coverage.
- Direct Purchase from Insurers
You can also purchase health insurance directly from insurance companies. While this option can provide flexibility in choosing a plan, it often comes without the subsidies or tax credits available through the Marketplace, potentially making it more expensive.