Insurance Coverage for the Self-Employed

Finding health insurance coverage if you're self-employed can be difficult with health care costs rising annually. Finding the right plan at an affordable price may require in-depth research and comparison of many separate health plans to determine which is best-suited for you. Several types of coverage plans rise above the rest in terms of affordability and coverage options for the self-employed.

Group Coverage

• Self-employed workers often form group-purchasing alliances to create similar buying conditions as employers receive when obtaining health insurance for a workforce population. Buying health insurance as a group allows for some discounts in monthly premiums, which can make the cost of insurance affordable where it may not have been if purchasing alone. According to the National Association of the Self-Employed, the best way to find group purchasing alliances is to visit the state department of insurance's website, where self-employed workers have residence or contact department offices directly in person or by phone.

Preferred Provider Organization

• A preferred provider organization, or PPO, is a health insurance plan which has multiple advantages for the self-employed: low co-pays to see a physician participating in the plan's network and no need for a referral to see an in-network specialist. The downside to a PPO is the coverage restriction in only being able to use coverage for in-network physicians. If a self-employed worker sees an out-of-network physician, she may be forced to pay the entire cost for medical services upfront. The worker may be reimbursed for paying upfront for medical services but that decision is ultimately determined by the insurance plan and the provider.

Point of Service Plan

• A point of service health plan, or POS, is similar to a PPO health plan in that it requires you to see in-network physicians to receive care. A POS health plan requires you to select a primary care physician from the company's stable of participating physicians. You may see out-of-network physicians for care but you are required to obtain permission from the insurance company before doing so or your visit may not be covered. According to the National Association for the Self-Employed, a POS health plan tends to provide more options for preventative care than a PPO health plan.

Catastrophic Health Insurance

• If you are a younger self-employer worker and less likely to need health insurance, you may consider purchasing a catastrophic health insurance plan. This type of health coverage handles high-cost medical procedures such as surgery, hospital stays, intensive care and medical diagnostics. Your deductible for this type of insurance can range upwards of $1,500 but this amount is small when compared to the costs you could incur from having to go to the emergency room without any health coverage.