Health Insurance For Self Employed
Obamacare has changed the rules for health insurance for self employed entrepreneurs. Prior to implementation of Obamacare or The Affordable Care Act (ACA), sole proprietors could qualify for a group health plan by simply making some creative changes to their business such as:
- Add a spouse or family member to payroll
- Make a spouse or family an official partner of the corporation
- Hire a part-time person (20 hours) to meet the 2 employee requirement
Unfortunately, since Obamacare became law in 2010, these options are no longer available to people who are self-employed.
What Does Self Employed Mean?
I know the answer to this questions seems rather obvious, but this is an important distinction about how the Government now views self employed. Obamacare views self-employed people differently. Here is the Government’s definition:
“If you’re self-employed with no employees you are not considered an employer. You are considered an individual and will be required to purchase an individual/family plan or be subject to a tax penalty. An individual can purchase a health plan on the Federal or State Insurance Exchanges or from a private insurer.”
Self-employed people are those that are in business for themselves, usually without employees. They are freelancers, consultants, 1099 employees or sole proprietors. Many entrepreneurs work out of their own homes or share office space.
Most enjoy the freedom of not having a boss or someone telling them what to do. But along with the freedom comes the stress of having to create your own income or paycheck. And now, finding your own health insurance plan.
Newly Updated For 2017!
Health Insurance Options For Self Employed
We will briefly cover 2 available health care options for the self employed:
- Individual Health Insurance
- Employer’s Network Association
1. Individual health insurance
Individual health insurance provides coverage for one person or a family. You can buy individual plans on the Government’s health insurance exchange, state exchanges or directly from an insurance company that offers a plan. You can also buy a plan from us and have a real person to speak with should you need help or have questions.
As brokers, we offer private individual health plans from companies such as: CareConnect, MVP and Oscar. You can view our plan options here: Individual Health Insurance NY
To qualify for an individual health insurance plan, you must buy a plan during the open enrollment period. Open enrollment begins November 15th through January 31st. If you miss the open enrollment period, you could still purchase a health plan within 60 days of a qualifying life event.
A qualifying life event includes:
- Losing coverage due to job loss
- Between jobs with no coverage
- Moving to a new state not covered by your current plan
- Having a child
There are 4 “metallic tiers” to choose from: Platinum, Gold, Silver and Bronze. The Platinum plans have the least out of pocket expenses but the highest premiums. The Bronze plans have the lowest premiums but the highest out of pocket expenses for medical care.
Avoid These Common Health Insurance Mistakes
When you are searching for a policy, don’t just look at the plan’s monthly cost. Many people make the mistake of buying the lowest priced policy but they do not figure in other fees they might face such as: doctor co-pays, deductibles and out of pocket maximums – meaning the most you might have to spend in a year.
Understand how your deductible works. Most policies nowadays have a deductible – this is the out of pocket amount you are responsible for before the insurance company pays. Some policies could have multiple deductibles – one for each family member.
Before you decide to purchase a policy, ask the insurer to provide you with the “Explanation of Benefits” (EOB), sometimes also called the certificate of coverage which gives you the full details of what your plan covers and what it does not.
2. Employers Network Association
This is a health insurance association program designed for individuals, sole proprietors or 1099 employees. You do not need a qualifying event to purchase one of these health plans. You can buy a plan any time. ENA is a private member’s only program and to become a member, you simply pay the association fee ($125.00). However you must be in good health to qualify for these plans. The application includes a brief medical history questionnaire. An underwriter will review your case before you can be approved for a policy.
Health insurance programs are offered through The Employer’s Network Association – Local Union 713, which currently covers more than 20,000 members.
These health plans utilize the Magnacare Network and the Cigna Network. ENA offers 5 PPO (Preferred Provider Organization) plans. Some plans are in-network coverage only and some offer both in and and out-of-network coverage.
Here are the plans available to self employed:
Elite Series PPO – 5 Plans to choose from:
Elite Platinum – Network, Magnacare
Elite 350 PPO – Magnacare
Elite 500 PPO – Magnacare
Elite 3000 PPO – Network, Cigna
ENA Prime PPO – Network, Physicians Health Care Services (PHCS)
For more information and to download terms, conditions and plan benefits, go to our individual health insurance page.
6 Tips on Choosing a Self Employed Health Plan
1. What Health benefits are important to you?
Purchase a plan that meets the needs of you and your family but also keeps your costs low.
For example: Do you take medications? Buy a plan with good prescription coverage and low co-pays. This could save you money on an annual basis.
2. Budget: Be mindful of your monthly budget but don’t buy on price alone.
Buy a plan with deductibles, co-payments and out of pocket maximums that you can afford if God forbid, you have a serious health emergency.
3. Physician network: Choose a plan that your doctor participates in.
Do you have a favorite doctor you want to keep? Which plans does he or she accept? This is probably the most important factor when considering which health plan to choose.
4. Brand Name: Are there insurance carriers that you prefer?
Are there any that you know have poor customer service or a history of slow reimbursement? Avoid insurance companies that have a bad industry reputation.
5. Consumer and industry reviews: Research complaints against insurance companies and ask friends if they have had a good experience about the insurance carrier you are considering. You can also check the financial ratings and complaints against insurance companies at your State Department of insurance.
6. Consider using the services of independent insurance agents or brokers:
Insurance agents and brokers like us at HealthPlansNY ,will work on your behalf to help you find a policy that meets your needs. A good broker or agent can also cut through the clutter and explain how each health plan works and what is covered in plain English.
Agents and brokers get paid commissions directly from the insurance company and the cost is already included in the monthly premium, so you will not pay more by utilizing the services of the agent or broker.