We receive a lot of questions about our health insurance since becoming self-employed. People often ask what we do now that we’re running our own business full-time with Claudia working only part-time. So, I thought it might be helpful to give you a quick rundown of our solution. It’s less complicated (and less expensive) than most people think.
photo by takomabibelot
My insurance:
For me, I have a Health Savings Account (HSA) through Aetna. This is a policy with a higher deductible ($5000) that’s very affordable. With an HSA, a pretax savings account is paired with your plan to use for medical expenses. With this type of plan, I pay for everything up to $5000, then the insurance takes over 100% (see policy details here).
HSA basics:
- higher deductibles
- lower premiums
- a pretax savings account is paired with your plan to use for medical expenses
Claudia’s insurance:
Claudia has a more traditional policy which is an HMO though Independence Blue Cross. While we could get a much less expensive plan, we chose this more robust plan because it covers maternity (see policy details here).
HMO basics:
- you have a primary care physician (PCP) that oversees all your care
- you must visit in-network providers for services to be covered
- referrals from your PCP are needed for almost all care
- no deductible
- copays for everything
- better coverage
- higher premiums
Jude’s insurance:
For our one year old son, Jude, we qualified for free healthcare through Pennsylvania’s CHIP program. This program is specific to Pennsylvania and offers health insurance for kids. Depending on your household income, your premiums are reduced or even eliminated. That’s been the case for us this year.
Our monthly health insurance costs:
- My insurance: $92
- Claudia’s insurance: $353
- Jude’s insurance: $0
Total: $445
This may seem expensive, especially if you’re working to grow a new business. However for us, we actually have had these policies for quite a few years now, long before we started our business. So, it was something we were used to factoring into our budget and paying for.
I’ve found health insurance for self-employed individuals to be less complicated (and expensive) than many people think. Plus, there are more and more options available today for getting coverage on your own. I listed a few more below.
Additional options:
National Association For Self-Employed
1-800-232-NASE
Samaritan Ministries International
(877) 764-2426
Christian Care Ministry
(800) 374-2562
Medi-Share
(800) PSALM-23
Christian Brotherhood Newsletter
(800) 269-4030
National Federation of Independent Business (NFIB)
1-800-NFIB-NOW
Question: If you’re self-employed, what do you do for health insurance? If you’d like to be self-employed, is health insurance a big concern of yours?
Leave your response in the comments of the post.
What a great, informative post which I am sure will be very helpful for so many who are wondering how they can do this if they are self employed. I plan to share this post with my son, Matthew’s girlfriend, as she is applying for some part time jobs and if any work out as she would like, she will have to pick up benefits like health insurance on her own. For me, my husband Alex has 4 more years in the school system as a teacher before he can retire so we are covered for now. But that gives me 4 years to get my business to the place I want it to pick up the slack and take up where we want to be! Thanks for sharing Michael.
Thanks, Ann. I hope it’s helpful for Matthew’s girlfriend. If she has specific questions, let me know. I’d be happy to see if I could help!
As always Michael you are incredibly gracious.
It’s really nothing. Just happy to see if I could help.
Thanks for those real numbers, Michael. I’ve heard Dan Miller talk about this “obstacle” before, but never heard any actual $$ from someone. Yes, healthcare is huge for us. I figured a couple years ago, what we spent on premiums and doctors, prescriptions, etc – I’d have to make about $14,000 a year to break even. We have a policy with my employer and even though it’s a semi-large company, we still pay about $650 a month due to the structure of it. It does pay well though, which you would expect given the cost. Health costs, even with insurance for us, has been huge given certain health issues. One of the factors I’m aware of is existing conditions, which I’m sure my wife wouldn’t quality for. Thanks!
Michael, you’re right. The preexisting conditions are usually not covered with the individual plans. One way around this is to joins a group plan through an organization like NASE and NFIB mentioned above.
Michael – Although I’m not self-employed, this breakdown was very helpful. I was able to share your blog with some friends who are doing what you are doing. These are great resources.
Thanks, Cindy. Glad you found it helpful.
Thanks for sharing this useful info!
Sure thing, Jim. Glad you found it helpful!