Top health insurance providers for self-employed Americans

Top health insurance providers for self-employed Americans | Insurance Business America

Top health insurance providers for self-employed Americans

Most Americans dream of being their own boss, with more than 70% of workers preferring self-employment over being an employee, a recent survey by Dartmouth College has found. Not many professionals, however, are willing to make the leap with only 6% (about 10 million) of the 164 million full-time workers in the country currently self-employed, according to the latest data from the Bureau of Labor Statistics (BLS).

These figures show a massive gap between the percentage of those who want to be self-employed and those who actually are. To find out the reason behind the “pretty stark difference,” personal finance firm 20 Something Finance opened a discussion on its website about why very few are living their self-employment dream. According to the participants, apart from the heavy financing and time commitment required, lack of access to quality and affordable health insurance is among the biggest factors hindering them from taking the self-employment route.

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How does health insurance for self-employed individuals work?

According to the healthcare information and advisory website Verywell Health, US companies pay about 83% of their employees’ total health insurance cost, estimated at $7,470 annually. But because self-employed individuals do not work for an employer, they need to shop around for their own health plan and cover the full cost of the premium.

There are several ways that self-employed professionals can purchase coverage, including:

1. Through the health insurance marketplace

For many self-employed Americans, the best place to start searching for a policy that fits their needs is through the government’s health insurance marketplace. Here, they can compare plans for coverage and affordability, and get answers to any questions or clarifications they have about healthcare insurance. This is also where they can find out if they qualify for Medicaid, tax credits, or lower premiums. Self-employed parents can enroll their kids in the Children’s Health Insurance Program (CHIP) through the marketplace as well.

Self-employed individuals can sign up for a health insurance plan during an open enrollment period, which typically runs from November 1 through January 15. But even if this period has ended, they may still be able to secure coverage if they have experienced a qualifying life event, including getting married, having a baby, and losing their previous insurance. Coverage begins about two to six weeks after enrollment. 

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2. Through private health insurers

Some insurance companies offer customized health plans for self-employed professionals. These often come with a range of benefits, including access to in-network providers and hospitals, annual check-ups, and preventative care.

What does health insurance for the self-employed cover?

According to Healthcare.gov, all plans in the marketplace offer the same coverages as standard health insurance plans under the Affordable Care Act (ACA), including doctors’ fees, inpatient and outpatient hospital care, prescription drugs, pregnancy and childbirth, and mental health services.

Policies are also “prohibited from excluding treatment based on pre-existing conditions” and must include dental coverage for children. Dental benefits for adults, however, are optional. Specific services may also vary, depending on the state where a self-employed individual is based.

What factors should self-employed workers consider when looking for health insurance?

When shopping for a health insurance policy, self-employed Americans have a range of factors to consider to ensure that they choose the right plan that fits their needs. These include:

  • Premiums: Their monthly payments should fit their budgets.
  • Deductibles: Plans with higher deductibles often have lower premiums, but self-employed individuals must first weigh up whether they can afford to pay higher out-of-pocket costs should they make a claim before agreeing to a higher excess.     
  • Copays: Copays are the amount the policyholder pays for a given service such as doctors’ consultation fees. Lower copays are ideal for self-employed professionals.
  • Customer satisfaction: High customer satisfaction ratings and good customer reviews reflect how health insurance companies provide services.
  • Company reputation: Self-employed workers must practice due diligence to ensure that they are purchasing a policy from a reputable company.
  • Prescription coverage: A plan that covers prescription medications is also a good option.
  • In-network physicians: Self-employed individuals should check whether their doctor is in-network for the policy they are choosing.

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How much does health insurance for self-employed professionals cost?

For health insurance plans under the ACA, five main factors influence premiums prices. These are a person’s age, address, and smoking status, whether the plan is for an individual or family, and the plan category. Health insurance costs for older self-employed professionals, for instance, can be three times the price of those for younger workers. Smokers, meanwhile, may pay up to 50% more.

The number of insurance companies in a state also has a huge impact on premiums as fewer providers means less competition, pushing up prices sometimes to the tune of hundreds of dollars. Insurers, however, are prohibited from charging policyholders more based on their gender, current health status, and medical history.   

Read more: Top 10 health insurance companies in the US

Which are the top health insurance providers in the US?

According to financial website Investopedia, the best health insurance plans for self-employed individuals “are affordable and offer decent coverage, with low premiums and deductibles, and a wide provider network.” It added that these professionals “should also look for a health insurance company with a good reputation and a simple claims process.”

To find out which insurers provide the best coverage for self-employed workers, Investopedia reviewed 15 of the top health insurance providers in the US, comparing each company’s history, reputation, product offerings, application process, nationwide availability, provider network, and claims process. These are the top choices. The list is arranged alphabetically. 

1. Blue Cross Blue Shield

Policy types: 4

States available: All

Providers in network: 1.7 million+

Blue Cross Blue Shield is Investopedia’s “best overall” choice for providers offering healthcare plans for the self-employed because of the company’s strong reputation, large provider network, and data-driven strategies to improve quality and affordability.

The Illinois-headquartered insurer provides coverage to its 110 million members nationwide, with a network that includes 96% of hospitals and 95% of doctors and specialists across the US. Americans living outside the country may also access health coverage through Blue Cross Blue Shield’s global network. The company offers health and wellness discounts such as gym memberships and fitness products as well.

“Self-employed workers may like Blue Cross Blue Shield’s data-driven approach, like the company’s National Health Index, which maps health status by county,” Investopedia wrote in its review. “Blue Cross Blue Shield also uses nationwide data to address major issues like the rising cost of healthcare.”

Read more: Blue Cross Blue Shield of Massachusetts to help vaccinate seniors

2. Cigna

Policy types: 4

States available: Arizona, Colorado, Florida, Georgia, Illinois, Kansas, Mississippi, Missouri, North Carolina, Pennsylvania, Tennessee, Utah, Virginia

Providers in network: 1.5 million+

The Connecticut-based health insurer has bagged Investopedia’s “best for convenience” award because of its virtual care and prescription home delivery options. Cigna holds partnerships with more than 67,000 pharmacies, 500 hospitals, and 175,000 mental and behavioral health providers across the US.

“Self-employed workers may love the convenience of Cigna’s Express Scripts Pharmacy, which offers home delivery of a 90-day supply of prescriptions along with 24/7 access to licensed pharmacists,” according to the financial website. “Cigna recently added Talkspace, a popular digital therapy service, to its behavioral health network. This provider has worked hard in these areas to make care as convenient as possible, thus winning this category.”

Read more: Cigna beats profit expectations

3. Kaiser Permanente

Policy Types: 3

States available: California, Colorado, Georgia, Hawaii, Maryland, Oregon, Virginia, Washington, Washington D.C.

Providers in network: 23,000+ doctors

Kaiser Permanente’s emphasis on preventative care has made it the top choice for the category. The company boasts a network, which includes 39 hospitals, 734 medical offices, 23,656 physicians, and 65,005 nurses.

“The company’s record-keeping and system of reminders make it easier to catch the early stages of a disease,” Investopedia wrote. “As a result, the company leads the nation in preventative cancer screenings and keeping a cap on high blood pressure, which is why it wins this category.”

Read more: Kaiser Permanente names new chairman and CEO

4. Molina Healthcare

Policy types: Varies by state

States available: Arizona, California, Florida, Idaho, Illinois, Kentucky, Massachusetts, Michigan, Mississippi, Ohio, Nevada, New Mexico, New York, South Carolina, Texas, Utah, Virginia, Washington, Wisconsin

Providers in network: Undisclosed

Focused on serving self-employed individuals receiving government assistance, Molina Healthcare has snagged the title of “best for underserved groups.” The company offers Medicaid and Medicare to its 4.6 million members across 19 states. Its plans are set up as an HMO, meaning policyholders have a copay due for many of its services.

“Molina Healthcare focuses on affordable healthcare for lower-income families,” Investopedia wrote. “If you’re self-employed and struggling to make ends meet, you may qualify for Medicaid, which offers comprehensive benefits through Molina.”

5. Oscar

Policy types: Varies by location

States available: Arizona, Arkansas, California, Colorado, Florida, Georgia, Illinois, Iowa, Kansas, Michigan, Missouri, Nebraska, New Jersey, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, Tennessee, Texas, Virginia

Providers in network: Undisclosed

Insurtech unicorn Oscar is Investopedia’s top choice in the customer satisfaction category because of its free virtual primary care and virtual urgent care – which gives 24/7 access to a provider – user-friendly mobile app, and a dedicated team of guides and nurses to answer questions policyholders may have and help them save money.

“If you’re tired of mediocre customer service, Oscar may be worth a look,” the financial website noted in its review. “As a member, you may use virtual care or the Care Team through the company’s mobile app along with easy access to your records, lab results, deductibles, and more. The company’s white-glove service may be particularly appealing to self-employed folks navigating health insurance on their own for the first time.

Read more: Oscar Health raises over a billion dollars in initial public offering

6. UnitedHealthcare

Policy types: 4

States available: all

Providers in network: 1.3 million

Its large network of providers in every state has made the Minnesota-headquartered insurer the top pick for the “best network” award. UnitedHealthcare has a network of 1.3 million physicians and healthcare professionals, and more than 6,500 hospitals. It offers a range of insurance products, including health, Medicare, Medicaid, short-term, vision, dental, and supplemental coverage.

Read more: UnitedHealth reports whopping $1.7 billion earnings leap

“UnitedHealthcare, part of the country’s biggest health insurance company, offers the most robust network on our list,” Investopedia wrote. “With coverage in every state, UnitedHealthcare may make it easier to find a health insurance plan with your preferred providers so that self-employed individuals don't have to skimp on medical care.”