Millions of people in the US are self employed and this trend is growing. Being self employed gives you the freedom that comes with being your own boss. However, you are also responsible for all the big decisions such as buying adequate health insurance. Thankfully, there are a number of self employed health insurance options available these days.
Here is a list of some of the best self employed health insurance options available to you. Do not forget that you are required to have health insurance coverage if you do not want to pay penalties under ACA.
Individual Health Insurance
As the name suggests, it is a type of health insurance policy that is bought by an individual for himself or his family. These health insurance plans can be bought through the health insurance marketplace of your state or by contacting a broker or by getting in touch with an individual health insurance company. There are a number of benefits of this option.
One of the biggest benefits is that it offers high quality health coverage for you as well as your family members. Also, this insurance is now available to everyone and it costs a lot less as compared to work-based group health insurance. The tax credits available for this health insurance also help in lowering the cost even more. It is a highly flexible as you are free to choose your own doctors as well as clinics. It is portable health insurance which means you keep the cover regardless of your job.
Many self-employed people obtain health insurance coverage through their spouse’s health insurance plan. This insurance turns out to be the most cost-effective and simplest way to get adequate health coverage for you as well as your family in case your spouse works for a large employer.
Health Savings Accounts
In simple terms, it may be defined as a savings or investment account linked to a high deductible health plan. Under this account, you are allowed to pay for all qualified medical expenses for you and your family using a separate account. A debit card is normally provided with this account which means you can easily pay for various medical expenses including surgical procedures, eye surgeries and prescription medications among other things.
This individually owned account has the potential to save you anywhere up to 30% on your annual medical expenses. Since you own the account you are free to use the money in the account as you wish. The only caveat is that the money must be spent only on qualified medical expenses. It is easy to fund the account through tax-deductible contributions.
All the withdrawals from the account are tax-free and the interest earned on the funds in the account is tax-deferred when it is spent on approved medical expenses. You are never going to lose the money in this account. You are also allowed to open an HAS investment account once the balance in the HSA reaches above $2000.
Many self-employed individuals also manage to obtain adequate health insurance when they turn to part-time work with an employer offering health insurance coverage even for part-time workers.