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Cost-Conscious Health Insurance for the Self Employed

Freelance workers find freedom in getting paid to do what they love. However, they often give up certain benefits of being a salaried, full-time employee. Among those benefits is a solid health insurance plan that some workers receive from their employers. Younger freelance workers may believe they can get by without paying for health insurance, especially if they are healthy and are meticulous about maintaining that health. However, sometimes part of staying health involves regular visits to a physician. Moreover, illness can strike at any moment. It is a good idea for freelance workers to look into methods of paying for health insurance that won’t stretch their budgets.

Federal Health Insurance Plans

Federal, state and local employees have some of the best health benefit plans in the country. Freelancers should look to their governments first to find affordable health insurance. Workers just starting out may qualify for Medicaid in their state. Medicaid is the name for the free health insurance program for the disabled and those living at or below the poverty level.

If you are earning enough to make a living, but still squeaking by, you can look into the Health Insurance Marketplace (HIM). The HIM was set up as part of the Affordable Care Act (ACA). If you are single and make less than 400% of the poverty threshold, under $49,000, you will be eligible to purchase subsidized plans from this marketplace. The plans will be priced based on how much you make.

While we’re considering federal law, note that before 2018, the ACA required nearly everyone to be able to show the federal government that they had health insurance or were signed up to the HIM. That portion of the law has been repealed; however, in 2018 it is still law. Therefore, if you don’t have health insurance in 2018, you will have to pay a penalty at tax time.1

Private Insurance Marketplaces

There are private health care plans available. You can purchase a plan from any health insurance company. However, they are likely to be very expensive. Some companies offer short-term health insurance plans that cost less, but also cover less health issues.

Some health insurance providers have combined to offer a marketplace similar to the federal government’s HIM. They are ostensibly to mimic the benefits of the HIM, but don’t carry the same regulations, like the ACA’s rule that a health insurance plan carries what the government considered 10 essential benefits. They may also be more expensive than plans currently on the exchange.

Charitable and Religious Organizations

Often charitable and religious organizations will attempt to step in and provide assistance for those in need. Religious based organizations provide “health care sharing” groups where people pay a fee and share in health expenses. This isn’t technically insurance coverage, so it isn’t regulated and is not required to meet federal rules regarding coverage.

If you are not covered by a plan, but you experience a sudden illness you can’t afford to treat, there are options for paying for your care. Your state or city may have organizations who will fund emergency treatment or provide some services. You may even find dental care through these organizations, which is often not covered well, if at all, by private insurance plans.

Families First

Some freelancers with families have additional options. If you are married to someone who is a full-time employee of a company or the government, you are already likely to benefit from their health insurance coverage. Some states offer benefits to the children of those who are not covered by an employee health plan. The amount of children you do have may determine whether you are eligible for Medicaid or subsidized insurance through the HIM.

Plan for Changes

Freelancers are familiar with fluctuating circumstances. One month is feast and another famine. Freelancers should remember that enrollment in the HIM is limited to open enrollment periods. Enrollment in Medicaid is not. If you are having a bounty of work for a short period that you know will pass, you should include considerations regarding health insurance in your financial planning.

1 https://www.healthcare.gov/fees/fee-for-not-being-covered/

This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.