Did you miss the Obamacare enrollment deadline of March 31?
Even though this year’s initial open enrollment period is over, there are still options for sole proprietors and freelancers to get the coverage you need.
From official government programs to alternative marketplaces and low-cost plans, let’s explore the options for healthcare plans for freelancers and the self-employed:
Obamacare – Enrollment is Still Open if You Meet Certain Conditions
Although open enrollment is now closed, the HealthCare.gov Marketplace does offer a special enrollment period for applicants who have experienced a qualifying life event or have a complicated case.
Qualifying events include moving to a new state, a job loss, loss of individual coverage, changes in income, and changes in your family (such as divorce, marriage, or a new baby).
Complicated cases include circumstances that made it difficult for you to apply for coverage during the open enrollment period. For example, if you suffered a medical condition that stopped you from applying or you experienced an enrollment error (i.e. one of those notorious HealthCare.gov launch glitches), and more.
If you think you fall into any of these categories and meet the income criteria for a Marketplace plan you can go ahead and apply on HealthCare.gov. If not, you may need to reconsider your options, since the next open enrollment for Obamacare runs from November 15, 2014 – February 15, 2015.
Low-Income Options – Medicaid and the Children’s Health Insurance Program
Medicaid and CHIP enrollment is open year-round for low income individuals and families. Coverage options depend on the state where you live. For example, if you live in a state that’s expanding Medicaid (meaning the federal government is throwing more funds at the program), you’ll probably qualify if you make up to $16,105 a year for 1 person ($32,913 for a family of 4). Read more about Medicaid and CHIP as an option on HealthCare.gov.
Now let’s take a look at some non-government affordable healthcare programs specifically designed for the self-employed:
Health Spending Accounts (HSA)
HSAs are basically savings accounts that you contribute to on a month pre-tax basis (up to an IRS-enforced limit) and then use a debit card to cover qualifying medical and health-related expenses. These plans are often cheaper because they have a higher annual deductible and any money you don’t spend rolls over from year-to-year – making HSAs a useful option for younger, healthy business owners. Read more about HSAs from CNN Money.
Call your current insurance company to see if your current health insurance policy qualifies to be used with a HSA. A licensed health insurance agent can help you with this process. Make sure you consult a tax advisor to make sure you’re realizing the tax savings to the max!
Chamber of Commerce HealthCare Programs
If you’re a member of your local Chamber of Commerce, many offer lower-cost health insurance packages for both self-employed business owners as well as those with more than one employee.
Small Business Incubators
Small business incubators are popping up all over the country offering everything from low-cost co-working space, networking opportunities, and access to business software such as payroll, CRM, and more. One membership-based incubator, WeWork, which operates nearly 30 co-working locations, also draws on the size and strength of its community to negotiate low insurance rates for members.
If you live in the state of New York, sole proprietors and freelancers may qualify for plans administered by the Freelancers Insurance Company (FIC), formed by the Freelancers Union. FIC offers affordable health insurance plans to its members and their families. Individual plans start at $471 per month with no co-pays, it also includes other perks such as free yoga, acupuncture and personal health coaching at its Manhattan and Brooklyn locations. FIC plans are subject to an open enrollment period, however, as with Obamacare, qualifying events such as births, marriage, or loss of existing coverage will open the doors to special enrollment.
Other Membership Organizations
In addition to your Chamber of Commerce, other unions, organizations, and alumni associations also provide self-employed healthcare plans. A quick Google search will list relevant organizations by industry and profession. Remember to factor in the cost of membership as you compare plans.
Here’s a list of the some member organizations that offer healthcare plans (care of Bobbie Sage at About.com):
Don’t Forget – Healthcare Premiums are Tax Deductible
The good news for the self-employed is that your monthly premiums are a 100% tax deduction. You can also deduct total medical expenses in excess of 10% of your adjusted gross income. Read more from IRS.gov.