Health Insurance Tips for the Self-Employed

health insurance

The number of freelancers and self-employed people is on the rise. Everywhere you look people are ditching their 9-5 and making their side-hustle or passion their full-time job. Yet, there’s one thing that’s getting in the way of many people’s dreams. That thing is health insurance.

It’s no secret that health insurance is complicated in the United States. With legislation constantly changing, it’s hard to know how exactly you’ll be affected by any changes. According to a recent study, a reported 27 million Americans are expected to leave their full-time jobs to strike out on their own by 2020. That means more people are going to be looking for self-employed health insurance. In this guide, we’ll tackle the best tips for finding self-employed health insurance. Hint: it’s not as confusing or expensive as you think.

1. Consider COBRA

Before anything else, consider COBRA coverage. If you’ve recently lost your job from a traditional employer where you had health insurance, you don’t have to lose your coverage right away. COBRA is a federal program that allows you to keep your employer-based coverage at your own cost.

It’s not too expensive either. Thanks to the federal government’s 65% subsidy for COBRA,your premium might not be as high as you think. COBRA is a great way to have coverage while you’re looking for your own self-employed health insurance.

2. Search the Marketplace

According to the federal Healthcare website, you have two main options for online marketplace searches as a self employed person. First, if you don’t have any employees, you can simply search the Healthcare Marketplace. This is intended for sole-proprietors, freelancers, or anyone else who isn’t eligible for employer coverage.

Your next option is if you have as little as one other employee who isn’t a family member. In this case, you can use the SHOP Marketplace for small businesses to find small business coverage in your area. The online marketplace is the best way to find comparative rates, see what providers are near you, and to lock in your rate.

3. Use a HSA

If you’re worried about being able to afford coverage, it might pay to look into an HSA or a health savings account. An HSA is a tax-advantage savings account that you can use with any HSA-eligible health insurance plan.

Because HSA plans usually come with higher deductibles and lower monthly premiums, you’ll be able to save your money in an interest-free account to use towards any medical expenses. This allows you to prioritize your freedom and income.

4. Don’t Forget Supplemental Insurance

Did you know traditional health insurance only covers basic essential care? This means you won’t have any additional coverage for health “extras” like dental, vision, or beyond. These are all things that are important to your health, and you don’t want to find yourself in a situation where you have to pay a high out-of-pocket cost.

Instead, opt for your own supplemental insurance. You can purchase this through your insurance provider or on your own, and it’s usually very affordable. Find an affordable vision plan and dental plan to make sure you’re covered for anything.

5. Take Advantage of Deductions

Finally, as a self-employed worker, you’re eligible for a number of health insurance tax deductions. Many states allow you to deduct health insurance premiums you’ve paid for yourself and any dependants as an “above the line” business expenses. You won’t need to itemize these deductions on your federal tax return, so it’s easy to take advantage of these savings.

However, be aware that you’re not qualified for any deductions if you were eligible to participate in an employer-sponsored insurance plan. If you’re truly self-employed and paying for your own insurance, this is a great way to keep costs down.

Protect Your Health

As you can see from the tips above, health insurance is actually quite affordable for self-employed individuals. Recent legislative changes are making big strives towards ensuring self-employed workers have the freedom and confidence to strike out on their own without worrying about their healthcare costs.

If you’re considering ditching your day job, don’t let health insurance hold you back. It doesn’t have to be complicated or expensive as long as you take the time to research each option.