Small business doesn't get much smaller than freelancing, but freelance issues don't come much larger than health insurance. In the past, a freelance writer, artist, or other practitioner basically had two paths to health insurance -- a costly standalone policy from a private provider or family coverage from a spouse's employer. But for many of the 42 million freelancers in the U.S. today, those "paths" often meant going without coverage.
Implementation of the Affordable Care Act has changed the options considerably: It has expanded eligibility (especially for those with pre-existing conditions) and it has prompted new public insurance exchanges, expanding options for many freelancers (and others). While the debate still rages over whether the law has lived up to its name by making coverage "affordable," most people can agree that the least affordable "choice" is facing medical bills without health insurance.
Even the most ardent supporters of the ACA acknowledge that the new options come with new complexities. Navigating the post-ACA health insurance landscape can be confusing. And for freelancers, the choices aren't so black and white.
Where to start
First things first, it's important to know that the ACA requires most people to have health insurance coverage or face a tax penalty. Those who fail to meet the minimum requirements face tax penalties next year of $95 or 1% of their adjusted gross income, whichever is greater. The penalty is scheduled to grow over time. That means going without minimum health insurance coverage will cost you -- even if you win the gamble and don't require expensive treatment.
There are two major types of health insurance "exchanges" (also called marketplaces): public and private. The public ones are state and/or federally run and can feature subsidies and tax credits depending on income; the private ones are offered by existing providers.
But before some freelancers start signing up for public and private insurance exchanges, they should at least consider some potential alternatives:
- Younger freelancers might find the best option under the ACA could be to stay on their parents' insurance plans until they turn 26.
- Married freelancers should compare the price of staying on their spouse's employer-provided coverage with buying a public or private plan.
So who should shop on the public exchanges? Individuals with an income of less than $46,000 a year and families of four with an income of less than $94,000 a year will be the biggest beneficiaries. That's because they are more likely to qualify for federal help. Freelancers who don't fall into one of those categories shouldn't rule out the public exchanges but may want to consider comparison shopping with the private exchanges.
Where to shop
Freelancers interested in the public exchanges should visit www.healthcare.gov. Visitors can view potential plans to get an idea of their coverage limits and costs; however, you may not be eligible for certain plans. To get an actual quote and to see which plans you are eligible for, visitors must first apply. Then, if you see a plan you like, you can enroll.
Related: 10 Top Sites for Freelance Services
For private exchanges, you either visit specific private insurance company websites or a marketplace site and get multiple quotes and plan options from different providers. For example, www.Healthcare.com offers multiple insurance carrier options for each state.
Ultimately, the ACA has given freelancers more health insurance options, but it's still up in the air whether they will take advantage of them or gamble with their health and pay the penalty. Regardless of the option they choose, freelancers should first consider all that's available to them and make an informed decision.
Author Bio: Carrie Van Brunt-Wiley is the editor of HomeownersInsurance.com.