Shopping for Health Insurance for the Self-Employed

If you are employed by a business, you most likely have access to a company-sponsored health plan. But if you are self-employed, you have no such luxury, and have to shop for health insurance on the individual market. Comparing the costs and benefits of each plan carefully is the best way to protect you and your family.

Current Health Insurer

• One of the best places to start your search for self-employed heath insurance is with your current health insurance provider. If you currently work for someone else but will soon be striking out on your own, start by contacting the sales department at your current health insurer and informing them of your plans. The sales staff at that health insurer can give you information on the plans offered to the self-employed and small business owners.

Health Underwriters

• After you know the costs and benefits of individual plans offered by your current employer, you can compare those costs to other plans by contacting an individual health underwriter. You can find a local agent with the search tool offered by the National Association of Health Underwriters. Contact several different agents and discuss your needs. The agent can then compare your rates at a number of different companies and help you find the best plan for your money.

Provider Network

• When evaluating various self-employed health plans, it is important to check the provider directory carefully. Look up the doctors, specialists, hospitals and pharmacies you use and make sure they are part of the provider network. You will pay much less if you use a network provider, while some out-of-network care might not be covered at all.

HDHP and HSA

• Health care plans on the individual market can be far more costly than those purchased by a corporation on behalf of its employees. That is because large groups have more purchasing power and are better able to negotiate both prices and benefits. One way to reduce the high cost of an individual health care plan is to combine a high deductible health plan, or HDHP, with a health savings account, also known as an HSA. These high deductible plans tend to have lower monthly premiums than other individual plans, and by funneling those premium savings into a health savings account you can save even more. You can also deduct the money you contribute to an HSA on your taxes, an important consideration for any self-employed individual.