Affordable Health Insurance For The Self Employed

One of the most difficult health insurance niches for people to obtain affordable health coverage is that of the self-employed. If you have decided that you will be self employed, congratulations however holding down you health insurance costs will be a monumental task.

There is however some good news. The Consolidated Omnibus Budget Reconciliation Act of 1985 (Cobra) allows employees to extend previous insurance benefits for up to 18 months after leaving a job. Now for the bad news. Employers no longer are required pay their portion of the plan’s premium, which can be anywhere from 75 to 80 percent of a plan’s cost.

By keeping the coverage and paying the employer portion, you’ll likely see a significant difference in what you pay for the coverage. The end result is a not so affordable health insurance coverage. COBRA rules can vary somewhat state to state so familiarize yourself with the laws.
Another option if you  married and your spouse is covered under another employer’s group health insurance plan, you may be able to get insurance coverage that’s less expensive than buying it on your own.  One important  advantage of this form of  coverage is that when your spouse adds your family to his or her coverage, the additional coverage usually can not be denied – or premiums rated up – because of health history or pre-existing conditions.

Some states such as New York, have what is known as guaranteed-issue health insurance. In those states, insurance companies doing business in the state must offer you the opportunity to purchase insurance coverage regardless of your health history. Again this varies state to state. Check with a health insurance professional in your state before dropping any coverage you already have.

The self-employed can deduct the cost of their health insurance premiums from their federal taxable income, not to exceed the amount of their actual income. This puts the self-employed on common ground with larger businesses. Self-employed business owners have not always had this deduction available to them.

In lieu of a previous employer insurance policy to assume, the self-employed can begin looking to establish small group health insurance policies with their insurance agent. Many health insurance companies take smaller groups and combine them with other small groups to establish a package for underwriters to consider. These group minimums for participation can be as little as one person.