Recommendations On Affordable Health Insurance For The Self-Employed?

Recommendations on affordable health insurance for the self-employed? The one deductible plan is an optional health insurance for self-employed folks. There is a plan out now that is called a high deductible...

There is a plan out now that is called a high deductible plan.

We sell one called the one deductible plan, which is the same kind of thing. What it's doing is it is allowing people to take back control over their health insurance. In the past, most people wanted big group policies and nobody really cared what it cost for going to the doctor, because you didn't pay it anyway. As things have spiraled out of control, that's no longer affordable, even group plans are real expensive. So what self-employed folks tend to do is get a high deductible plan. Let's say they get a plan and they have a $2500 deductible. That means every time they go to the doctor, every time they get a prescription drug, every time they do anything up to the first $2500, they pay all of it. At $2501, they don't pay anymore and the insurance company picks it up. That's a very simplistic version of it, because there are 18-20 splits and all these other things that you can do.

If there are pre-existing conditions before you get the insurance, it might make it harder to get the coverage at all or they just exclude that condition. I had a person recently that had broken her leg in a motorcycle accident, so the company excluded any work on that leg for a period of two years. So if you went and re-broke it, or had extra medical attention, sorry, you're not going to be covered. That is the difference between individual coverage and group. A lot of people think group is less expensive. In fact, group is a whole lot more expensive. They are usually subsidized by your employer, so you don't notice it. But group is more expensive because healthy people pay for people that are not healthy. If you are healthy and you buy an individual policy, you pay less money because there is nothing wrong with you at that time.

Now another benefit of high deductible plans for self-employed folks is there is an account called the health savings account. There is a law that went into effect in 01/04 and it allows self-employed people to get some of the same benefits that people working for big companies get. It allows you to put money inside pretax and then use that money to pay your deductible. It is unlike your deductible that you pay for your health care up to the amount of your deductible as in a year. So in our $2500 example, a person could take $2500, not pay tax on it, put it in the special health savings account, and then when the person goes to the doctor and needs to write a check for $300, it comes out of that money that you have already saved. You didn't pay any tax on it so it is a benefit that is now available to self-employed and small business owners, things like that. The other really cool thing is a similar benefit that is available to the people who work for big employers, but they have to spend all of their money every year. At the end of the year, if there is any money left over, they lose it. With this health savings account, whatever money is left just rolls over to the next year. So you can actually build it up, kind of like a retirement plan, and use it for health care when you retire.

© High Speed Ventures 2010