Health Insurance 101: What to Do If You’re Self-Employed

You’ve achieved the American dream—now it’s time to figure out American health insurance.

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You’re living the dream… you’re your own boss! The downfall is that the United States typically ties health insurance to your employment. As a result, it can be overwhelming to find your own insurance coverage if you’re self-employed.

How to Get Health Insurance If You’re Self-Employed

If you don’t qualify for Medicaid (more on that below), you have two main options: sign up for insurance through a private insurance company, or enroll in a plan through the Health Insurance Marketplace.

Under the Affordable Care Act (ACA), business owners, contractors, freelancers, consultants, partners, or LLCs can sign up for insurance on the Health Insurance Marketplace. The process starts by submitting an application online during the enrollment period at HealthCare.gov.

Just like with private insurance, you can choose between different types of plans, based on you or your family’s health care needs. You might qualify for premium tax credits, which reduces the cost of your insurance premium (monthly fee). This may be based on your net employment income and family size. Plus, business owners can often deduct their health insurance premiums as a tax write-off (through Form 1040).

Remember, once you have more than one employee, you can enroll for a company plan directly from an insurance company. You start by visiting the website of your desired health insurance company and going to their page “for employers.” Then, you can select a tier of insurance plans for your employees (and you!) to choose from. Group plans tend to help you and your employees save money, as opposed to everyone seeking out their own insurance.

You Might Be Eligible for Subsidized Benefits

On HealthCare.gov, you can also find out whether you qualify for Medicaid and/or the Children’s Health Insurance Program (CHIP). These are government-sponsored insurance programs reserved for certain groups such as lower-income citizens or families, pregnant women, the elderly, or people with disabilities. These plans are lower in cost or sometimes free, depending on your individual factors.

Finding the right insurance for you and your family can sometimes be daunting. Visit HealthCare.gov or speak to your preferred tax prep company to see what you qualify for.