Person looking at their phone

What You Need to Know About Self-Employed Health Insurance in 2023

HealthPlans of NC

Financial Considerations When Getting Self-Employed Health Insurance

If you are or are considering becoming self-employed, it is important to understand the ramification it may have on your health insurance. You may no longer receive coverage under your employer’s insurance plan. Therefore, it is essential to consider your financial situation and choose a health insurance plan that is affordable.

What Are Available Options for Self-Employed Health Insurance?

For self-employed individuals, there are different options to consider when selecting a health insurance plan. With the assistance of a licensed insurance agent, you may find the plan that works best for you.

1. COBRA Health Insurance

Consolidated Omnibus Budget Reconciliation Act (COBRA) allows individuals who no longer work with the company to remain under their employer’s health coverage. To be eligible, you must be currently enrolled in your employer’s group health plan. Furthermore, it is required that your company has at least 20 employees. Smaller businesses do not qualify for COBRA.

COBRA Health Insurance

Essential Things to Know About COBRA

When considering COBRA, there are important pieces of information to know. Typically, you have two months to decide whether or not you want COBRA health insurance. If you do, you are required to pay entire monthly premiums and an additional 2% administrative fee. COBRA plans provide coverage for 18 to 36 months. After enrolling in a new health insurance plan, COBRA will stop providing coverage.

2. Purchasing Health Insurance Through the Insurance Marketplace

For long-term coverage, you can purchase insurance from the health insurance marketplace. There is an open enrollment period from November 1st to January 15th. However, you can enroll in Medicaid and CHIP (Children’s Health Insurance Program) at any time.  You may also be eligible for a special enrollment period if you recently lost coverage or have another qualifying event.

What to Consider When Choosing Self-Employed Health Insurance?

It is important to understand the different insurance plan types as they each have different coverage characteristics. By speaking to an experienced insurance agent, you may find a plan that meets the needs of you and your family.

Health Maintenance Organization (HMO)

Under an HMO plan, you are required to visit primary care providers that are in-network. While this plan type offers less flexibility, it is generally more affordable. Furthermore, you must live or work in the HMO’s service area to receive coverage. Therefore, this plan works best for those who don’t require frequent travel. In addition, you typically need a referral from your PCP to visit a specialist. However, there are exceptions for medical emergencies and OB/GYN care.

Preferred Provider Organization (PPO)

For those who want more flexibility in their coverage plan and are willing to pay higher fees, a PPO plan may be best. With this plan, you are allowed to visit out-of-network care providers. However, this comes at the cost of higher monthly premiums and copays/coinsurance rates. PPO plans do not require referrals to visit specialists.

Health Savings Account (HSA)

If you receive coverage through an HDHP (High-Deductible Health Plan), you may enroll in an HSA (Health Savings Account). With this option, you can withdraw funds tax-free to help pay for health insurance expenses. This can help cover coinsurances, copays, and deductibles. In 2023, the contribution limits for an HSA are $3,850 for self-only coverage and $7,750 for family coverage.

Tiers and Categories of Self-Employed Health Insurance Plans

There are different tiers for health insurance plans. Under the Bronze tier, you pay the lowest monthly premiums. However, you also pay the highest coinsurance rate at 60/40. In addition, you have a higher yearly deductible.

With the Silver tier, you have a coinsurance split of 70/30. 

Finally, the Gold tier has the highest monthly premium but the lowest yearly deductible. The coinsurance rate is 80/20.

Ask your insurance agent

Discover The Costs Involved With Self-Employed Health Insurance Plans

Along with benefits and coverage options, costs should be highly considered when choosing a health insurance plan. Specifically, self-employed individuals may have to fully cover monthly premiums. You also must understand your yearly deductible, coinsurance percentage, and copayments. Therefore, it can be quite beneficial to speak with an insurance agent. By doing so, you can better understand these fees.

Discover Savings Options When Getting Self-Employed Health Insurance

If your income falls between 100% and 400% of the federal poverty level, you are eligible for premium tax credits. This will lower the cost of your monthly premiums. Furthermore, those who use less than their qualified premium tax credit receive a refundable credit when filing taxes. In addition, you may be eligible for a cost-sharing reduction. With this, you have lower copayments, coinsurance, and deductibles. Also, you have a lower out-of-pocket maximum. However, to qualify, you must be in a Silver tier plan.

You can receive a quote to discover which plan you’re eligible for.

What Other Options Are There for Self-Employed Health Insurance?

While the health insurance marketplace is accessible, there are other options. If you are under 26 years old, you can receive coverage through your parent’s health plan. Qualifying individuals can also enroll in Medicaid.

Need Assistance In Getting Your Self-Employed Health Insurance?

If you need help accessing the best self-employed health insurance in North Carolina, it’s worth getting guidance from an experienced and licensed health insurance agent. At Health Plans of NC, we understand the importance of having comprehensive health coverage. So get in touch with us today to find out your options or compare plans. It is our goal to help you find the plan that works best.

Ready to get started?

See plans and pricing today.