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Health Insurance for the Self-Employed (in the United States)

Self- employed individuals rarely have time for themselves. And because your health is the most critical aspect of your life, signing up for health coverage is necessary. UnitedHealthcare incorporates a diverse range of network providers, including resources, so you don’t have to worry about time management.  Meanwhile, you can check out for the Golden Rule coverage plans under UnitedHealthcare if you don’t have employees.

Health Insurance for the Self-Employed: What You Should Know

The Affordable Care Act introduced additional necessities for insurers and coverage for consumers, changing the coverage landscape. However, the mandated coverage is no longer available for consumers, but states like New Jersey have validated mandates for residents at the state-level.

When choosing health plans, focus on coverage with huge expenses. More often, plans with high costs can impact your lifestyle or even save you the burden of paying medical bills for years. 

It’s also worth noting that health insurance has its own lingo and policy terms, which can negatively impact your coverage policies and deductibles. Therefore, it would help if you understood the most common policy terms to avoid unnecessary expenses.

Factors Determining Your Overall Health Insurance Cost

While other types of insurance incorporate hundreds of factors, health insurance includes a few individual elements, which can impact your premiums. Such include:

  • Age: The older you get, the more premiums you’ll pay. 
  • Location: Your state laws are more likely to impact your premiums.
  • Tobacco use: Depending on your state laws, some insurance companies will impose high premium tobacco users rates.
  • Individual vs. family: Often, plans that extend coverage to the entire family are more expensive than individual plans.

In addition to the individual rating factors, plan features like out-of-pocket will also affect your premium rates.

How do I get Health Insurance for the Self-Employed?

Self-employment can range anywhere from owning your enterprise to working from home freelance gigs. Whatever the contract, you’re walking towards becoming your own boss and taking charge of everything, including your health coverage.

So let’s go in-depth about the options should you have plans to start a self-employed gig – whether short term or a lifetime.

1. The Marketplace (Healthcare.gov)

You’ll want to explore the insurance industry to find the right health coverage. The Marketplace plays a vital part in the Affordable Care Act to help consumers find health insurance options available in their locations.

The Marketplace will also provide you with a list of ACA-compliant health coverage plans in up to eleven states along with their health coverage exchanges. Washington, D.C’s health plans are different from other countries.

The plans are often sorted out using metal monikers such as silver, bronze, gold, and platinum. In most cases, higher-level plans offer comprehensive overall coverage. Depending on your earnings, you may also be eligible for subsidies to help with budget cuts. Sadly, subsidies aren’t available for bronze plans.

If your salary is within the poverty level of 138 percent, you’ll likely meet the Medicaid requirements, and the Marketplace will walk you through the right resources for your state. Although the Marketplace isn’t the ultimate way to purchase health coverage, it serves as a center for exchange for many insurance companies selling coverage plans on the Marketplace.

2. Association Health Plans

Association plans will vary depending on your industry. Most associations will often charge an annual fee for membership; however, your membership can impose several benefits, including access to association health coverage plans. Unlike the plans purchased by employers for employees, these are group plans. Association plans tend to offer lower negotiation rates.

Like mentioned earlier, the Affordable Care Act introduced additional necessities, prompting many associations to stop health insurance offerings. Initially, tons of association companies would align their plans with states’ requirements contrary to the federal guidelines.

The ACA requirements enacted some coverages mandatory to reduce the association plan options. However, some options, such as investigate associations and evaluate membership, are still available as one package.

While associations might get industry-specific, below are a few associations worth considering:

  • Costco
  • Alliance for Affordable Services
  • Freelancers Union

If you have employees, Professional Employer Organizations (PEOs) might be your cup of tea. This group health association provides coverage to outsourced business services such as payroll processing and HR.

3. Health Savings Account (HSA) to Reduce Premiums

A health savings account lets you save for future healthcare expenses without paying taxes. All you need is to choose a health coverage plan with higher deductibles to enhance your eligibility for HSA. An individual deductible of $1,350 or a 2,700 family deductible qualifies you for the HSA. 

There are a lot of things you can do with your HSA. For example, you could save some money in an interest-bearing account for future healthcare expenses, including expenses like dental and vision, which aren’t covered by most health plans.

For the most part, an HSA integrated with a high-deductible health coverage plan will provide a more comprehensive way of securing healthcare needs, reducing your premiums.

4. Health Care Indemnity Plans

Often referred to as fee-for-service plans, healthcare indemnity plans differ from traditional healthcare coverage plans. Unlike any other healthcare plan with complicated exclusions, healthcare indemnity offers a more straightforward structure with lots of flexibility, of course, at a price.

Additionally, healthcare indemnity lets you pay a certain percentage for most services and a full price for services not inclusive of the plan.

Finally, you’ll have to pay your medical services directly to the provider, after which it’s refunded to you at a fixed price. And because there are no deductible limits with indemnity plans, these plans are often used as supplements to the existing coverage plans. It is also worth noting that indemnity plans aren’t ACA-compliant, a requirement for some states like  New Jersey.

What Should I Look For?

Priorities vary from each household. While some may prioritize monthly affordability over unexpected expenses, other homes may prioritize physicians above any additional costs.

So whatever the priority, make sure to have in-depth knowledge about the health insurance provider. Most importantly, the cost of monthly premiums. This is because your premium rates will fluctuate depending on yearly expenses.

More often, reputable and established healthcare companies will provide tons of options to leverage your plan choices. Your choice of plan or provider should include long-term benefits.

Our Top 5 Health Insurance Recommendations for the Self Employed

1. Kaiser Permanente

If you’re looking for regional insurance, Kaiser Permanente should be your first bet. Although its availability is limited to eight states only, this insurance offers exceptional rates with a wide variety of options. Also, it’s the right choice for self-employed individuals who are older but not eligible for Medicare. What’s more? There are price advantages to Kaiser Permanente’s plans.

2. Humana

Humana takes pride in its diverse availability. It is located in up to twenty-two states. Not only that, but Humana is also one of the most affordable healthcare options for self-employed individuals. While expenses such as dental and vision aren’t covered in most healthcare coverage plans, Humana includes such costs in their health insurance plans. Similarly, Humana doesn’t provide short-term plans, just like Cigna.

3. UnitedHealthcare

UnitedHealthcare takes pride as the largest healthcare provider in the United States. It has a reputable platform with a range of plans such as ACA- compliant plans, indemnity insurance, and higher deductibles that qualifies one for a tax-free health savings account. Despite being the largest, this coverage is affordable and incorporates easy-to-use tools to help manage your account.

4. Cigna

Cigna is another popular insurance provider that offers group health coverage plans. It’s ideal for self-employed individuals with employees. Its individuals’ plans are available in up to twelve states across the U.S. Dental plans are also included in the Cigna’s plans. Customers are also assured of a diversified network of doctors, including significant deductibles that qualify one for a health savings account. Meanwhile, Cigna doesn’t offer short-term coverage plans. 

5. Blue Cross Blue Shield (BCBS)

Again, Blue Cross Blue Shield is a reputable coverage based in the U.S. It incorporates hundreds of regional insurance companies across the United States. Plan accessibility varieties depending on state laws, which is okay in the health coverage industry. Customers can anticipate a diversified network of physicians with BCBS and its federation companies.

Frequently Asked Questions

1. How Much Is Health Insurance for the Self-Employed?

Like mentioned before, several factors will determine your health coverage premiums. Should you need an individual or a family coverage plan, below is a summary you need to check out:

  • The overall premium for individual insurance without Obamacare subsidies goes for $393
  • The overall premium for a family plan without Obamacare subsidies goes for $1,021
  • Average out-of-pocket plan individuals and families go for $4328 and $8,352, respectively.

2. How Much Can I Deduct From My Self-Employed Health Insurance?

Full amount. Qualified self-employed individuals can often deduct the total percentage of their health coverage premiums for themselves or even their dependents depending on the plan.

3. How Does a Self-Employed Person Get Health Insurance?

If you’re operating on an income-generating business and you have no employees, you’re considered self-employed. This means that you can opt for the individual health plan available in the health coverage Marketplace.

Bottom Line

Your health is a critical aspect of life and needs to be treated as one. With a health coverage plan, paying for medical expenses is a no-brainer. You can also set aside some money in a tax-free savings account for future expenses. And because health guidelines change over time, make sure that you’re updated with the current approaches to avoid higher deductibles. 

If you’re just starting your business, you may want to consider the Marketplace plan with subsidies that’s short-term to save on money. However, a high-deductible health plan or a savings account is a good bet if you’re looking for a cost-effective solution with a lot of flexibility.

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