Health Insurance Options
for the Self-Employed
By Lisa "Pearly" Weinberger
With today's society allowing business to be performed easily with a click of a
mouse, it is no wonder the Internet has grown to allow the entire world to be
connected 24 hours a day. It has allowed many people to quit their jobs, move
across the world, and become self-employed. Individuals, who would have
normally worked for a company, have now found the pleasures of being their own
bosses. Technology has opened many new age business practices where e-mail and
instant messaging are the preferred source of communication with clients.
Becoming your own boss takes self-discipline. The certain luxuries like health
insurance and a 401K plan, which we may have taken for granted while working for
a corporation, are now extra added expenses that have to be considered.
Things like health insurance, which is automatically included as a benefit in
many full-time positions, now must be researched, compared, and considered.
Usually the monthly cost can be much more expensive since the self-employed
individual is now paying the entire bill, not just a small percentage.
What are the options available to a person who chooses to work for herself?
If the individual was working full-time for a corporation, many health insurance
companies will offer 18 months of Cobra coverage after leaving the company. The
cost for Cobra is 102 percent and the plan's coverage stays exactly the same.
For example, if you had Cigna's PPO plan as your health insurance provider, when Cobra begins, all your doctors and benefits do not change. Prices
range from $300 a month for an individual through $1500 a month for family
coverage.
Self-employment allows tax deductions to be taken out for health insurance as
well. The general rule is the health insurance has to be established through
the business; just paying Cobra to continue the coverage does not follow this
rule. By taking the full income made and subtracting half for your
self-employment taxes, plus taking out any other deductions (IRA), the leftover
money is the amount you are allowed for health insurance expenses. This can
occur only when you are fully paying your own benefits.
There are also other coverage options. For example, freelance writers have
different organizations they can join. A benefit of associating with career
groups is health insurance companies then offer discount plans to the
organization and it's members. This would be the first step to research after
the Cobra option.
Another option is a discount health plan. Instead of health insurance coverage,
the individual has a choice of medical, dental, and vision plans. A monthly fee
is paid and certain doctors and practitioners are in the network. This means
certain physicians participate in the discount plan and accept the partial
payment. The individual is responsible for the remainder of the doctor's bill.
Other discount plans will have the patient pay the entire bill to the doctor,
which is already at a discounted price, and then send a claim form into the
company. For example, the doctor's bill with the discount is $50.00 and the
patient pays the full amount before leaving the office. The claim form gets
sent in to the discount health plan by the patient, and two weeks later, a check
for $40.00 arrives. The total cost for the one doctor visit was $10.00 out of
pocket.
With many of the health insurance options offered to self-employed workers,
prescreening, referrals, and rules pertaining to the number of visits allowed
per year can apply. Researching all the options before deciding on the plan
which best suits your individual or family needs is suggested. Websites can give
free quotes for the health insurance companies or discount health plans.
If you find making a decision is too difficult with all the options on the
Internet, there are insurance agents who can help explain the pros and cons of
each. An agent who is reputable can be found through referral services
or by asking other self-employed businesses.
Lisa "Pearly" Weinberger is a twenty-something (almost
thirty-something) freelancer who focuses her skills on writing, business, and
photography. Involved with many website developers and print media companies,
she also has a creative edge where many of her writings are aliased as a pen
name. PearlyWrites, LLC offers copywriting, editing, marketing,
advertising, and researching services for nonfiction, fiction, adult content,
and small businesses.
With more than 10 years' experience, Lisa and her
unique sense of style and openness to suggestions has allowed PearlyWrites, LLC
to plan for continued success in the future. For more information, please visit
www.PearlyWrites.com.
