The two words that make the idea of freelancing full-time more daunting: Health Insurance. Just the mention of it can elicit cold sweats and a string of frustrating questions: How do you get it? What does it cost? Why is everything so hard?
It's easy to be overwhelmed with the state of healthcare in flux, and the prospect of navigating it, terrifying. But we're here to help. Sometimes, just laying out the basics makes tackling the intricacies a lot more manageable. With that in mind, here's a primer on your basic options as a freelancer.
Where freelancers can look for health insurance:
Freelancers Union: If you’re looking for health insurance, the Freelancers Union’s website is a great place to start. While they no longer offer their own plans, they do handpick health insurance plans to fit the specific needs of freelancers. Simply visit the Freelancers Union site, provide a few bits of relevant information about yourself, and compare the available plans in your area.
COBRA: If you just left a full-time job with benefits and decided to go freelance, you might be in luck. Thanks to COBRA (Consolidated Omnibus Budget Reconciliation Act), you may be able to temporarily extend your health care plan. How does it work? Essentially, after you leave your job, you will be given the option to continue your coverage for 18 to 36 months. However, your ex-employer will no longer be paying any part of the bill. Instead, you will cover the entire premium, and you’ll also be responsible for a small administration fee. The bad news? COBRA plans often come with a heavy dose of sticker shock, since there’s no longer an employer to share the cost-burden. Still, this could be a great temporary option while you figure out your next health care move.
Note that if you decide not to utilize your COBRA, and you’re outside of the main enrollment period, you still have options. According to healthcare.gov, “losing job-based coverage qualifies you for a Special Enrollment Period. This means you have 60 days to enroll in a health plan, even if it’s outside the annual Open Enrollment Period.”
Affordable Care Act’s Health Insurance Marketplace: As a freelancer, you have the option of using the federal government’s individual Health Insurance Marketplace to enroll in a health care plan. This year, the Open Enrollment Period has been shortened to just over six weeks, running from November 1st, 2017 to December 15, 2017.
When you fill out a Marketplace application, you will need to provide an estimate for your net self-employment income for the year. This will determine if you qualify for tax credits or savings on your insurance. Depending on your income, you may even qualify for low-cost or free health care coverage through your state’s Medicaid or CHIP programs. The Marketplace provides a range of coverage, from high-premium/low-deductible plans to catastrophic plans.
If your business has even one employee besides yourself, you may be eligible to utilize government’s the SHOP Marketplace for small businesses.
Join a Union or Guild: Unions and Guilds are another great place to look for health insurance. While most do not offer their own health care plans, they do organize members and utilize the power of numbers to drive down costs for those who participate in the group plan. The more members a group plan has, the more the costs are able to be pooled. This means lower premiums for you. Look into unions and guilds for your profession, and see what options they’re offering. Besides nabbing group savings, the other upside to taking this route is that these professional organizations often have representatives dedicated to helping you navigate the insurance-buying process. This means you’ll have someone looking out for your best interests who can answer your individual questions and help you find the best possible option for you.
Here are just a few of the unions and guilds available for freelancers today:
Find another professional group: If you don’t belong to any unions or guilds, or can’t find one to serve your needs, there are still group options you can take advantage of. Often, local Chambers of Commerce, professional and business associations will have group insurance plans you can participate in. As previously mentioned, buying health insurance in a group means saving money. Look into what’s available in your area and compare plans. You might be able to get a better deal than you expected.