Family Health Insurance Plan When You're Self Employed

May 7th 2016

Before You Leave Your Other Job

Are you planning on becoming self-employed and want to prepare for it? Look into getting COBRA health insurance. Through COBRA health insurance, employees may extend their health benefits for up to 18 months after leaving their jobs. The downside to COBRA insurance is that it is expensive. You are required to pay for the entire amount of your premium, plus a 2 percent administrative fee. Basically, you end up paying 102 percent of what your previous employer paid your health insurance company to keep you insured. Because of this, COBRA health insurance may not be your best option.

Work Part-Time

Did you know that some employers provide health insurance benefits to their part-time employees? Companies like Starbucks and Trader Joe’s offer health benefits to part-timers. Do your research and find out which companies do this for their employees. See if you can work a part-time gig like this into your schedule and reap the benefits.

Check Your Spouse’s Policy

Does your spouse already have health coverage? It may be advantageous to simply add yourself to the policy. Getting health insurance coverage through your spouse's existing policy is usually cheaper than buying health insurance elsewhere. Another benefit of choosing this option is that it's often easy to add additional family members to the policy.

Get Help

Consider using the services of health insurance brokers. They generally work for free, as they are paid by the insurance companies they represent. Health insurance brokers are a good resource for the self-employed as they are equipped to find you health insurance which meets your personal needs. Locate a reputable health insurance broker by contacting the National Association of Health Underwriters.

Check out www.eHealthInsurance.com. They are basically a company of digital brokers who offer insurance plans from various providers. This allows you to compare your options while getting advice from an experienced agent.

Individually Underwritten Policies

If your health record is relatively clean, one good option for you if you are self-employed is to purchase an individually underwritten health policy from the open market. The key is to choose a plan which has the right amount of benefits at a cost that works for you. Be aware that there are many factors that should come into play in your decision, such as coverage types and location limitations. Be sure to select a plan that provides adequate health benefits for you and your family.

Organizations

Do you belong to a professional association such as AARP or the Freelancers Union? Specific trade organizations and professional groups offer health insurance plans to their members. Check out available insurance plans from the National Association for the Self-Employed at www.NASE.org.

Factors

The cost of health insurance for the self-employed depends on variables such as your age, your health and the state you call home. However, starting in 2014, through Obamacare, you will be able to select a health insurance plan through state-funded insurance exchanges. Learn more about the Obamacare health plan to see if it is right for you.

Beware of association-endorsed health plans, which are currently under scrutiny from federal and state government agencies. They are often established for the sole purpose of marketing health insurance plans. Because many of these companies offer loopholes for consumers, they raise their prices to make up for it.

Regarding Pre-Existing Conditions

If you have a pre-existing medical condition, and you are concerned about getting health insurance coverage, COBRA is one viable option. With COBRA, you cannot be denied coverage for a pre-existing condition.

Another helpful resource you can use if trying to purchase health insurance with a pre-existing condition is to check out the handy health insurance locator at www.HealthCare.gov, where you can find health insurance options in your state, including health insurance for people with pre-existing conditions.

Consider This

Before making a decision on a health insurance provider, consider how often you go to the doctor and how much you spent on medical care in the past year. Do you need medical care enough to justify paying monthly premiums just to have insurance coverage?

Tax Benefits

Good news! When you are self-employed, you are allowed to deduct the cost of your health insurance premiums on your tax return, as these costs are considered a business expense.

Image Courtesy of Heidi Olson via Flickr

Don't let the fear of finding health insurance keep you from fulfilling your professional dreams. With this guide in hand, you're already one step closer to being happy, healthy, and self-employed!

References:

http://www.forbes.com/sites/kerryhannon/2012/01/04/the-best-ways-to-find-health-insurance-if-you-are-self-employed-in-2012/

http://www.healthinsurance.org/learn/self-employed-health-insurance/

http://www.doughroller.net/insurance/how-to-get-health-insurance-if-youre-self-employed/

http://www.healthinsurance.org/learn/self-employed-health-insurance/

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