Self employed health insurance
You are an entrepreneur, implying that you take care of a small business of your own. You could be an individual without employees, or you could be leading a small team of workers. Whichever is the case, it is imperative that you will give a serious thought about purchasing your own health insurance. For many self employed health isurance businessmen, offices, cars and PCs are generally priorities for insurance, but many entrepreneurs overlook their own health, their most valuable possession. With a little bit of earthly wisdom you can buy your own peace of mind.
People who work for themselves, have the responsibilities of running the whole show. For example, they will need to be constantly innovative regarding the current situation and the future prospect of their business. Should they fall ill, it will be too late to look for coverage. The most important thing to remember is that health insurance should not be an afterthought. If you look for coverage, start now.
Policies you can look for
* If you have a partner or spouse, then you can consider a coverage which would pay out a large lump sum after your demise and leave them free of worries such as a business liabilities or debts.
* In the event of sickness, a permanent health policy may be more suitable. A Permanent Health Insurance is ideal because it replaces income if the individual is unable to continue his business due to permanent illness.
A standard individual or a family policy is your best option, if you are an individual self employed health insurance without an employee or dont consider employing one in future. You will have a choice of managed health care and indemnity plans or fee- for- service. Managed health care is more affordable but the choice of providers is limited.
* Self employed health isurance has better facilities if the policyholder employs two to fifty people. He will be eligible for group health insurance under the category of personal health insurance.
It is not out of the way to mention that the insurance system does not work as efficiently and cheaply for an individual self- employed as it does for an employed. There is a simple logic behind this. Individual self employed health isurance makes it difficult for insurance companies to distribute risks and minimize the probabilities of paying out a large compensation.
What is managed health care plans
Under this system the financing and delivery of health services are controlled by an organization to impart services to the enrollees in a specific type of plan. The aims of managed health care are to
* Deliver high quality care under controlled costs
* The care delivered is necessary for the condition of the patient
* Care is rendered by the most appropriate provider
What are the main types of managed care plans:
* Indemnity: This plan enables the member to act as the go-between, i.e. there is no arrangement between the provider and the insurance company directly to transfer money. The enrollee is billed by the provider and paid these bills first, submitted the bills to the insurance company and then was reimbursed for the bills by the company. This plan is now interchangeable with Fee-For- Service.
* Fee-For-Service: It is a plan that will support you by paying 80% part of a doctor*s visit. You will pay 20% of the fee.
It is imperative that you will start paying your deductible before the insurer is ready to foot your bill. Deductibles range between $200 and $1000.
* Health Maintenance Organization: Only the member doctors are eligible to take care of you. When necessary you require visiting a primary care doctor, and he may refer to a specialist if he feels you need his attention. With HMO policy you need to co-pay for each visit of the doctor.
* Pre- Provider Organization and Point OF Service: PPO and PPS will give you more freedom regarding your selection, but the premiums are usually higher.
* Non-Traditional Sources: There are a few other sources of insurance too that is worth- while to mention. The credit card company offers many forms of insurance with no extra expense. They have benefits such as car rental, travel, and health while on trips.
Most self-employed people obtain health coverage in the Individual Insurance market. People shopping for this type of insurance, however, may have many more choices than those who receive it as a benefit.
Two factors make individual insurance more expensive than group insurance.1. First, group insurance is priced according to the entire group of employees. In the individual market, the policy- holder is taken as a* group.* 2.Secondly, the group insurance is free from a person*s taxable income because the employer receives a full benefit in dollar value for spending money on health insurance of his employees.
Let not the self-employed be too disappointed at this news. He can also have his breather after hearing that the self-employed insurance deduction was increased to 100% from 70% starting from 2003. Those working as a consultant, freelance worker, and other individual self-employed persons will be allowed to deduct all their insurance premiums.
MSA Scheme
To minimize the cost of health insurance you must determine your tolerance for risks and choose a policy you are comfortable with. If your health is fine, i.e. your visiting rate to the doctor is comparatively low then you can go for a higher deductible to save on premium costs. An increment of deductible from $100 to $2000 will cut the premium by half.
Under Health Insurance Portability and Accountability Act (HIPAA), a self- employed is eligible to use MSA or medical savings account. MSA work for those who opt for higher deductible health insurance policies and thus it uses the money of the reduced premiums to pay for the medical expenses. Of course it is up to the limit of your deductible on your insurance policy.
Fundamentally, you can select a high deductible policy instead of a low deductible one and save the premium money by contributing to MSA, and get a tax benefit as a bonus. Suppose you spend less than you contributed, the surplus stays in the account to grow in mutual funds and stocks to accumulate in a tidy sum. This may be saved as a retiring benefit.
But the range of deductibles is limited from $1,500 to$2,250 for individuals and $3000 to $4,500 for a family.
( citation * Elena Faulkner www.leatherspinters.com)
If you are uninsurable
* The Health Insurance Portability and Accountability Act may offer you some relief.
* High risk health insurance plans, also known as risk pools are funded by the state that ensure protection for those who are denied health insurance because of a medical condition.
What you need to do as a self-employed person seeking health insurance is to be creative and look everywhere. Use that creativity that makes your business functional and successful and opt for one that suits you most.
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