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6 Ways to Find Affordable Health Insurance If You’re Self-Employed

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As an entrepreneur, you are responsible for securing your own health insurance which can be challenging and overwhelming without employer-provided benefits. But being your own boss also opens up a world of opportunities and perks.

According to a 2021 study published in Health Services Research, almost 25% of self-employed workers do not have health insurance, which is a significantly higher rate compared to regular employees. Although skipping health insurance may seem appealing, it can lead to disastrous consequences.

6 Health Insurance Options for the Self-Employed

As a self-employed individual, you can still obtain the necessary healthcare. Check out these six resources for affordable health insurance options as an independent contractor or freelancer.

1. Health Insurance Marketplace

The Health Insurance Marketplace is designed for individuals who are not covered by their employer, such as part-time employees, freelancers, gig workers, college students, self-employed individuals, unemployed individuals, and early retirees under 65 years old. It is a result of the Affordable Care Act.

If you enroll in insurance through the public marketplace, you may receive subsidies to help lower your premiums. This could be a way to save money on your health insurance coverage, as 14.5 million people have already done so.

There is no limit to the amount of income you can earn and still receive subsidies, but the premium tax credit you qualify for increases as your income decreases.

You can only enroll in coverage under the Affordable Care Act during the 11-week period from Nov. 1 to Jan. 15 each year unless you experience a major life change like getting married or divorced.

To sign up for healthcare coverage, visit HealthCare.gov. Once you’re on the home page, you can choose to enroll in a plan for the first time, check out your current coverage, or compare different healthcare plans.

2. Health Insurance Brokers

Stride and Gravie are health insurance brokers who offer a range of plans from different insurance companies. They can help you compare these plans quickly and find the coverage that best suits your needs.

If you’re not familiar with health insurance, it can be helpful to work with an agent or broker. However, keep in mind that they usually receive commissions from selling insurance products.

It is important to be aware that an agent’s recommendations may be affected by the commissions they receive from insurance companies, although this is not necessarily a negative aspect.

3. Your Partner’s Employer Plan

You may be able to enroll in your partner’s employer-sponsored health insurance plan if they are employed and have access to it at work. It can save you money and provide coverage.

In some companies, self-employed spouses or domestic partners can join the employer’s insurance plan irrespective of their employment status. However, some companies may ask for proof that they do not have access to any other insurance coverage.

If you are looking to enroll in your partner’s plan, you may have to wait for their open enrollment period. However, if you just got married, you might be able to join the plan earlier as it is considered a qualifying life event.

4. Freelancer and Industry-Specific Groups

By becoming a member of certain professional associations and organizations, you can gain access to group health insurance plans that offer affordable coverage with discounts for members.

For instance, if you’re a freelancer, you can explore health insurance plans provided by the Freelancers Union. Similarly, the National Association for the Self-Employed (NASE) is committed to helping self-employed individuals and small businesses. As a member of NASE, you can request a quote for their health insurance options.

If you are looking for discounted health insurance, you should consider checking industry-specific organizations such as the National Writers Union or the Professional Photographers of America for potential leads.

5. Health Insurance Companies

If you are self-employed, you can buy private health insurance plans from health insurance companies such as Cigna and UnitedHealthcare.

There are various pricing and coverage options provided by the companies. Selecting the appropriate one may be challenging, but it is beneficial to invest time in researching your options.

Please be aware that buying a health plan from a private company can be quite expensive if you do it alone.

6. Health Care Sharing Ministries

Faith-based organizations provide financial assistance to their members by sharing the burden of medical costs. Members contribute on a monthly basis, and the pooled resources are used to pay for each other’s medical bills. This system acts as a safety net for the group.

In order to join the ministry, it is typically necessary to share the same religious and ethical beliefs. Although healthcare-sharing ministries may seem like a tempting option, it is critical to note that these organizations are not obligated by law to pay for your healthcare costs.

The extent of coverage can differ, and certain procedures or pre-existing conditions may have limitations.

How Much Does Health Insurance Cost for Self-Employed People?

The cost of health insurance depends on several factors – your age, location, desired coverage level, and the specific plan you choose. Due to these variables, it can be tricky to determine the average cost of a plan.

According to KFF, the Health Insurance Marketplace usually costs the average person $438 per month. However, your expenses may be lower based on your residency or eligibility for tax subsidies.

Great news! You might qualify for tax deductions pertaining to your health insurance costs. Under the self-employed health insurance deduction, you can deduct the entire amount of your health insurance premiums from your adjusted gross income when you file your income taxes.

One advantage of this deduction is that it is a modification of your income, not a deduction based on specific expenses. This implies that you can claim it regardless of whether you choose to itemize your deductions or take the standard deduction.

Tips for Saving Money on Health Insurance Coverage

As a freelancer, you are responsible for finding your own health insurance. This means you need to search for the best coverage and plan that fits your budget. Here are some tips to help you with your search.

  • Check the marketplace first: Before you reach out to an insurance broker or use a private exchange, it’s advisable to investigate Health Insurance Marketplace plans – they typically offer the best value for the self-employed.
  • Crunch the numbers: To fully understand the costs, don’t just focus on the premiums. Take into account the deductibles, copayments, and out-of-pocket maximums of each plan for a complete picture.
  • Consider high deductible health plans: The monthly premiums of these plans are lower, but the deductibles are higher, at least $1,500 or more. You can combine an HDHP with a health savings account to gain tax benefits and save money for upcoming medical expenses.

Remember to always read the fine print, regardless of which option you select. Having a complete understanding of your health insurance coverage could result in significant savings.

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