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By Dominic Messina
THE BAD NEWS
If you're one or the growing ranks of Americans who are self employed,
you know how expensive it is to get comprehensive health care coverage.
Oh sure, it's available... just not at the same price that large businesses
pay as they qualify for group rates.
Worse yet, the premiums which small businesses (less than 200 employees)
have for heath insurance coverage is increasing at twice the rate that it's
increasing for large (500+) employees according to William M. Mercer Inc.
(www.wmmercer.com), a consulting firm specializing in employee benefits.
Not surprisingly, an estimated 40 percent of small-business owners do
without insurance, according to the Insurance Information Institute
(www.iii.org), because they believe they can't afford it.
Because of their high price, too many self employed individuals settle for
health coverage that is inadequate. Such business people are threatening
not only themself and their family's health, but also their business' very
existence should they ever become injured or seriously ill.
THE GOOD NEWS
If you're planning to leave or recently have left full-time paid employment,
you can still retain your existing health insurance thanks to a law known as
COBRA (Consolidated Omnibus Budget Reconciliation Act) of 1985. COBRA
can provide a bridge for the newly self-employed as it allows you to retain
the same insurance coverage at the same price that you had before. As a
former employee using COBRA, you have to pay the full premium that your
employer was previously paying or supplementing. That is still cheaper than
an individual policy, since the coverage is purchased at a group rate. When
it expires, you have the choice to continue with that same plan -- at an
The problem is that COBRA only lasts 18 months, and after that those who
are self employed are on their own. However, there are some options that
self employed business people have to reduce how much they pay for
health care coverage. These are:
1. Use The Internet To Become Better Informed
Whether shopping for the lowest health insurance rates or wanting to ask
medical questions of experts, learning to do research on the internet can
make you a more informed consumer, thus bettering your chances of lowering
your health care costs. The better educated you are about health care, the
more you can avoid unnecessary and/or expensive medical insurance.
2. Get Coverage From Your Employed Spouse
A common and easy way to get long term health coverage is to add yourself
to your employed spouse's existing policy, and use the extra premiums
you'll have to pay as a tax-write off, of course.
3. Join With Other Self Employed People
There are strength in numbers so investigate joining a professional or trade
organization that offers its members coverage at a group rate discount. Two
such groups are the National Federation of Independent Business
(www.nfib.com) and the National Association for the Self-Employed
(www.nase.org). However, before joining a group just for its health insurance
plan, one should consider the cost of membership in addition to the
4. Lower Your Level Of Health Insurance Coverage
If you are healthy and don't require much medical care, why give the money
to the insurance company for low-cost claims when you could keep it yourself?
If you choose a higher deductible or a higher co-pay, the money you save in
monthly premiums might actually be more than you spend out of your pocket
in a year.
5. Reduce Your Chances of Getting Sick
You know the old saying about an ounce of prevention being worth a pound of
cure? Well, this is especially true when it comes to reducing your health care
costs. According to Marilyn Furry (Associate Professor Of Extension Education -
Penn State's College of Agricultural Sciences), the best advice to follow to
avoid high health insurance premiums as well as out-of-pocket health care
expenses is to do the following:
(a) Take advantage of free health screenings at local clinics, hospitals
or health fairs
(b) Know early warning signs of potential health problems and consult a
(c) Compare fees and costs for medical, pharmacy and surgical procedures
(d) Keep accurate medical expenses records so you can itemize these deductions
on your taxes
6. Join A Discount Health Benefits Club
Perhaps the best way to cover any existing gaps in your health insurance is to
join what is known as a Discount Health Benefits Club such as Ameriplan
(www.ameriplan.com) or MediSavers (www.medisaver.com). These clubs offer
their membership savings on prescription drugs, dental visits and other health
services by charging a fee to connect members with doctors, dentists,
vision centers, and chiropractors.
Rising medical insurance costs force many self employed professionals to
eliminate coverage in areas like dental, vision and prescription drugs. But with
these areas covered when one joins s discount health benefits club, any gaps
in the self employed dental, vision and prescription drug coverage are eliminated.
Also, because 'discounted health benefits' aren't insurance, they can be used
in conjunction with existing health insurance to lower certain costs and even
supplement coverage for both the self employed as well as the self insured.
Due to their ability to supplement existing health insurance, discount health
benefit clubs must be considered a strong health care alternative for the self employed.
AS MORE PEOPLE BECOME SELF-EMPLOYED, MORE OPTIONS WILL APPEAR
Perhaps the best advice a self employed person can get on reducing their health
care expenses is to keep informed about changes in the small-business
benefits arena. Organizations such as Working Today (www.workingtoday.org)
and the National Association for the Self-Employed (www.nase.org) are building
networks and lobbying Congress to improve access to better health and
retirement plans for independent professionals. Consider lending your
voice to theirs and maybe someone will here you.
If you find the article you just read valuable, you might be interested in a page
from Dominic's Website (http://www.home-base-business.net/healthtips.htm)
titled "Ways To Lower Your Health Care Costs". This page is a "must read"
for anyone who feels threatened by the rising cost of health insurance in America.
Dominic Messina has been a health insurance professional since 1983 and
currently sells Ameriplan discount health benefits to individuals and
organizations from his home office where he struggles to keep his cat "Zorro"
from jumping up on his desk. You can email Dominic at email@example.com
|This article was submitted by - Dominic Messina||Please Rate/Review this Article - Recommend it to friends|
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