It is commonly believed that the largest group of individuals without health insurance is the unemployed. While this is true, the number one group of uninsured individuals among those who are working are the self-employed. These are individuals who are sole proprietors employing five or fewer people who simply cannot afford to pay for medical insurance. They are one of the largest groups of individuals who are consistently ignored when talking about health insurance reform.
Health insurance quotes are easy to find online if you enter your zip code into our free search tool below.
According to Bankrate.com, the Insurance Information Institute pegged to the number of self-employed individuals without health insurance at approximately 40% in the year 2000. Those numbers have remained largely unchanged according to 2010 census data. The fact is, self-employed individuals are caught in a quagmire; they can’t afford private insurance, yet they make too much money to qualify for Medicaid or other government options.
Has anything been done over the last 10 years to help self-employed people?
Private health insurance companies have recognized the glaring lack of affordable health insurance for self-employed individuals. They have done their best to accommodate such individuals by offering group policies through:
- Trade organizations
- Chambers of commerce
- Various business-related groups
Unfortunately, it hasn’t made coverage any more affordable than it is for large companies because the premiums are ultimately about the same price. Self-employed individuals, especially sole proprietors, simply don’t have $500 or more to spend on health insurance every month.
Some states have responded by enacting legislation, which opens the door for lower cost coverage subsidized by tax dollars. In New York for example, the Health Care Reform Act of 2000 cleared the way for a health insurance program known as Healthy New York. New York City’s Independent Budget Office provides an overview of the law, which shows the state’s efforts to help expand health insurance to New York’s self-employed and low-income individuals.
How do I get information on self-employed health insurance coverage?
If you’re the type of individual who bristles at government assistance, you can look at other options first. Start by contacting your local chamber of commerce to see if they offer any types of coverage. Who knows, they may have something you can actually afford. Typically, a chamber of commerce offers group rates for the current HMOs and PPOs available in your community. You would purchase the policy through the chamber and make out your monthly premium checks to them.
In the event that your chamber of commerce offerings are not affordable, you can also check with trade groups specializing in your particular industry. Sometimes these trade groups will have access to decent health insurance coverage at affordable prices. This is especially true if the particular trade organization is a nationwide one. The more members the trade group has, the more strength they have in securing lower cost health insurance policies.
If both of those options prove unfruitful, you may need to utilize a government-sponsored program. Details about such programs are usually available from your state insurance department or one of the private insurance companies that operate in your community. Government-run programs like Healthy New York utilize private insurance companies to administer their plans, so those companies have all the details.
What does self-employed health insurance cover?
If you’re purchasing coverage as a self-employed individual directly from a private insurance company, you will be afforded the same coverage options as anyone else purchasing from that same company. You can choose plans that cover only catastrophic care, managed care plans, or plans that are a combination of both. Each plan offers:
- Different types of coverage
- Different deductibles
- Different levels of total annual coverage
You have to compare each option in order to make an informed choice.
If you’re purchasing your insurance through a government-subsidized program like Healthy New York, you’ll be given options that are somewhat similar to private insurance except with a few extra limitations. For example, a state subsidized insurance plan might limit the total amount of annual payments for certain types of treatments. They may also not cover things like:
- Mental health issues
- Drug and alcohol abuse
- Elective procedures like vasectomy and plastic surgery
Because health insurance coverage varies so much between policies, the only way to be sure of the type of coverage being offered to self-employed individuals is to go over all of your options with a fine toothcomb. It is time consuming and unpleasant, but it is one of the things that comes with being self-employed.
If you are self-employed, start searching online for health insurance quotes by entering your zip code below.