The complete guide to health insurance for independent workers
If you’re self-employed, you know how the job can vary from day to day. You might be managing multiple small projects, driving passengers each day, or working on a long-term assignment with one client. Whatever your style, you miss out on one important benefit of the usual full time job: employer-sponsored health insurance. You need to purchase a health plan on your own so you can stay healthy throughout the year, protect against unexpected (and very expensive) medical bills, and avoid paying a yearly government fine.
Your health plan needs to fit your lifestyle, but it also needs to be extremely cost-effective and easy to choose. Use these tips to get a head start and stay on track while finding the best plan:
Tip #1: Learn the basics!
Don’t know how health insurance works? Not sure what “deductible” means? Check out this quick guide. In just a few minutes, you’ll be an expert on basic health insurance features, how doctor networks function, and more. Knowing this info will help you make smarter choices!
Tip #2: See if you have a qualifying event.
Open Enrollment (the time of year when you can sign up for health insurance) doesn't start until November. However, there are many circumstances that allow people to buy a plan throughout the year. These are called qualifying events, and we have the full list of 'em here.
Tip #3: Consider a Health Savings Account (HSA)
An HSA is a savings account that can only be used for certain health-related expenses. Because you don’t pay taxes on the money you put into an HSA, it’s a powerful financial tool that helps you plan for the future and save money. Consider this: If you’re an average individual paying about 25% of your income in taxes, you can effectively stash away $100 in your HSA while only reducing your take-home pay by $75. That’s like getting $25 for free. Even if you have insurance now, check your plan – you can use an HSA to pay for many types of coverage, including employer plans.
Tip #4: Put your health expenses to work for you.
If you’re self-employed, there are many different expenses you can deduct at tax time. Doing this correctly can actually save you thousands of dollars. These deductions include your health insurance premiums (monthly payments) and sometimes even your other medical costs! Read our tax guide to learn more about how this works
Tip #5: Know your income. Cash-in on discounts.
Your income probably isn’t a fixed annual salary, which means it might be difficult to figure out how much you make in a year. It’s worth the extra effort to estimate what you’ll earn this year, though; correctly reporting your income when you apply for health insurance can qualify you for some serious government discounts! These can make your monthly premium significantly cheaper, perhaps getting it down to just $10/month! Read this post for some advice on correctly estimating your income.
Tip #6: Comparison shop.
The trick to finding the best plan is to understand your medical costs. If you don't see the doctor often, a more expensive plan with lots of benefits may just waste your money. However, if you take prescriptions and see a specialist, the cheapest plan may cost you more in the long run. Not a numbers person? Let Stride do the math for you; in just a few seconds, we'll recommend the plan that will save you the most annually!