The number of self-employed people in the United States is rising day by day, and while you might not have the advantage of having other employees to pick up the slack for you in the workplace you do have numerous other advantages. For example, you’re generally going to have fewer expenses, and that can even apply to the health insurance that you use.
Enrolling in the Marketplace
The individual Health Insurance marketplace will be available for the following:
- Independent Contractors
Though we have only noted a few, it is important to understand that the coverage and marketplace is available to anyone who runs their own business and has no additional employees. If you’re curious, you can always call to ask if you qualify.
What is a Self Employed Individual?
As we mentioned above, an individual would be considered self-employed if they have a business that generates income but does not employ any other individuals. That said, if your business has even one other employee then you would not qualify to shop on the individual Health Insurance Marketplace. You may, however, have the option to use the SHOP Marketplace which is designated for small businesses. The SHOP marketplace allows you to purchase coverage that you would not have access to otherwise and it is perfect for keeping your employees covered. For more information on the SHOP marketplace, feel free to visit the marketplace and see what they have to offer.
Covering the Self Employed
Moving back into the area of self-employment, there are several great options for you, and it all starts with filling out a marketplace application.
Fill out a Marketplace Application
Once you fill out the application you’ll be given a better idea of what kind of coverage you are going to qualify for. You will also find out a bit about premium tax credits and whether or not you are qualified for them. This determination will be based on these two factors:
- Your income
- Your household size
Once you have filled out the application, you will also learn about low-cost coverage and whether or not you qualify.
Low Cost Coverage for the Self Employed
Filing out the application will tell you more about Medicaid and Chip, most importantly, whether not you qualify for it. CHIP stands for Children’s Health Insurance Program and is capable of supplying both free and extremely low cost health insurance to families across the United States. This includes, of course, low-income families, families and children, pregnant women, the elderly, and those who suffer from disabilities. In some states, the Medicaid programs have been expanded for the purpose of covering all individuals who are beneath a certain income level, so make sure you inquire about that if you are planning to speak with the Medicaid provider in your area.
Categories of Coverage
As you look through the marketplace you will come across several options, for example, there are varying categories which include plans that have lower premiums to protect you in worst case scenarios. If you want to pay a little bit more every month, you could find a plan that will offer more services, including cost reduction for general healthcare visits. When you first sign up for coverage, make sure you check your income to determine whether or not it is in range to save any significant amount of money each month.
Estimating your Income
All of your information does need to be entered correctly as you are applying for coverage, and it is important to note that Marketplace savings are based on your estimated net income for the year that you’re getting coverage. In other words, you aren’t going to be using last year’s income to apply for coverage this year. Yes, it can be a little confusing, but we’re pretty sure you have it under control.
When you fill out your Marketplace application, you’ll have to estimate your net-self income and while it can be confusing at first, it is completely doable.
As a self-employed individual, it can be difficult to estimate income for the coming years, but the marketplace does offer some advice on estimating your income in the event that you are self-employed.
Avoiding the Penalty
Like most Americans, you will need to make sure that you have a qualifying health plan from the marketplace or from a private insurer. Failure to do so will result in a hefty penalty, and this is true regardless of your job status. It is well known that the current administration is attempting to eliminate this fee, but we seem to have a long way to go before we see any meaningful outcome.
For right now, coverage is crucial even if you are the only employee. Browse the marketplace or seek out a plan that will cover you in the event of a worse case scenario.