Traditionally, finding good health insurance coverage has been a challenge for some freelancers. We’ve even discussed the challenge of finding health insurance here on Freelance Folder.
For years, I’ve also heard the horror stories about freelancers who skipped buying health insurance coverage (something I’ve never recommended) and then got sick. You’ve probably heard the stories too, or you might even know a freelancer who goes without health insurance.
For many freelancers, health care options are about to change.
If you are a freelancer who lives in the United States, then you probably already know about the Affordable Care Act (ACA). The ACA becomes law in January of 2014.
What you might not know is exactly how the new health care changes will affect you, as a freelancer. However, you may need to make some important insurance decisions as soon as October of 2013.
While I’m far from an insurance expert, I’ve outlined a few basic points about the new law that all freelancers need to understand. I’ve also compiled a helpful list of five informative posts that discuss the ACA changes.
What You Must Know
As a freelancer, you need to know the basics of the new law. Here is a high-level overview of some of the more important changes:
- If you’re uninsured in 2014, you may face a penalty. The penalty begins at $95 for each adult or 1% of your family’s income, whichever amount is higher. The penalty is scheduled to go up every year for the next few years.
- Insurance costs are based on earnings. The exact amount you pay for insurance coverage depends on your earnings. The lower your income, the less you pay.
- Some freelancers will get a tax credit. You may be eligible for a tax credit if you are under 65 and your income is less than an amount ranging from 100% to 400% of the Federal Poverty Level (FPL). (The dollar amount of the Federal Poverty Level is based on how many members are in your family.)
As you can tell from the points above, health insurance specifics vary depending on your individual circumstances. And some individuals are exempt from the law.
5 Helpful Posts
To make an informed health care decision, you need information. That’s why I’ve compiled a list of Affordable Care Act posts written directly to freelancers and small business owners. If you want to learn more, this list is a good place to start.
Here are some of the best posts on the Affordable Care Act as it pertains to freelancers:
- How the Affordable Care Act Will Affect Freelancers–And 5 Ways Freelancers Can Get Health Insurance Now from Linda Formacelli writing on the Renegade Writer blog. This post provides a good overview of the Affordable Care Act. It also lists some freelancing insurance options for right now (before the act goes into effect). If you’re currently uninsured and need a plan immediately, read this post.
- How The Affordable Care Act Can Help Freelancers from Mike Cahill writing on Guerilla Freelancing. This is a great high-level overview of some of the basic provisions of the Affordable Care Act that are likely to affect freelancers.
- 3 Simple Health Reform Steps for Freelancers and Sole Proprietors from Cathy Miller writing on the Simply stated health care blog. This is actually a three-part series of helpful posts that takes you through what you need to know in a step-by-step fashion. This is highly recommended if really want to understand how the act will affect you.
- Best Health Insurance Options for Freelancers from Frank Addessi writing on the Planting Money Seeds blog. This is another good overview of the Affordable Care Act for freelancers. This one includes a discussion of HMOs.
- Five Ways the Affordable Care Act Helps America’s Small Businesses from Natale writing on the Small Business Association Community blog. While this post from the Small Business Administration is aimed at small business owners, many of the features listed also apply to freelancers.
The Bottom Line
As always, I highly recommend getting health insurance. Along with charging a professional rate for your services, having adequate health insurance coverage for you and your family is an important part of earning a living as a freelancer.
Since the new health laws represent a change over the status quo, I recommend learning all you can about how the law impacts you as soon as you can.
Remember, there’s no “one size fits all” insurance option. Instead, your choices and costs will vary depending on the size of your family and on your current income.
Don’t put your health insurance decisions off until the last minute.
Have you started to look into your 2014 health insurance options yet?