More people are choosing the freedom and flexibility of a career path as an independent contractor. If you’re working locum tenens, or considering this role, you usually have to find individual health insurance without an employer-based plan. Often, healthcare providers are so busy providing care to everyone else that they neglect to consider the importance of ensuring that their personal health and well-being are maintained.
Neglecting to get health insurance when you’re an independent contractor can leave you with halted income and high medical costs if you get sick. If you’re not covered under your spouse’s health insurance plan or as a dependent on your guardian’s plan, it’s important to do a little research to ensure you get a plan that suits your needs. The thought of choosing a health insurance plan may feel overwhelming. Luckily, there is an abundance of information available to help you choose a plan.
Determine What You Need
Health insurance premiums can be high, but rates can vary based on location and healthcare utilization. The cheapest plan is not always the best option. The monthly premium you pay to maintain your health insurance is determined based on the coverage option you choose, the deductible amount you pay before insurance contributes, and fixed copayments for medical appointments and other healthcare services.
Your cost can vary based on the plan you choose, your personal health history, and if you require family coverage. Individual insurance is usually more expensive (per person) than a group plan, but you may be able to lower the cost by choosing specifics for your plan based on your personal health and health insurance usage.
Calculators like the Kaiser Family Foundation can help you estimate your premium payments and determine if you qualify for any assistance. Besides ensuring that you have the health insurance coverage that you need, obtaining insurance as an independent contractor may make you eligible for health insurance premium tax credits.
Do Your Research
No one wants a costly surprise when it’s time to use insurance, or discovering that your primary care physician doesn’t accept your plan, so luckily there is information available to help you make the best decision.
If you don’t want to do the research yourself, you can use a state insurance broker. They partner with insurance companies to sell policies and can explain your options to help you make a decision. You can also go directly to a health insurance carrier to choose one of their plans, or you may choose to do the research yourself. Here are some places to begin looking for the best health insurance plan for your needs as an independent contractor:
- The Freelancers Union can help guide you to learn more about health insurance terms, and it also offers a health insurance plan.
- The Health Insurance Marketplace evolved from the Affordable Care Act (ACA). Health insurance plans are offered for self-employed individuals, freelancers, consultants, independent contractors and small business owners with an open enrollment period from November until mid-December. Insurance begins on January 1st the following year. If you’ve missed the enrollment period, you can still check to see if you qualify for special enrollment.
- Check to see if you qualify for Medicaid or Medicare. These are government run health programs that are age- or income-based. Medicare typically provides benefits starting at age 65.
- Short-term health insurance might be a temporary option. This doesn’t always offer the benefits of a permanent plan, but you may be able to get a lower cost and cover gaps in your insurance coverage.
Other Health Insurance Options
- COBRA (Consolidated Omnibus Budget Reconciliation Act): If you’re a new independent contractor or preparing to leave full-time employment, you may have the option to use COBRA as a continuation of health coverage for 18-months until you find insurance. This is a temporary option that usually has a high premium, but gives you more time to make a decision.
- Join your partner’s plan. Insurance for domestic partners is mandated in some states, and some companies have voluntarily added this insurance option. You may not have to be married as long as you meet the state, or the company, definition of a domestic partner.
- Check to see if you have access to a group plan. Compared to group insurance, an independent contractor may find it harder to get help with issues that arise, such as gaps in coverage. Even if you’re no longer working for an employer, you may be able to join a group plan such as one with your Chamber of Commerce, The Freelancers Union, the American Association of Retired Persons (AARP), or another professional association you belong to that may have one available. These plans tend to cost less, since risk is spread across the group.
There are insurance options for independent contractors if you know where to look.