Health Insurance Advice for Freelance Writers

By Amy Derby

One of the biggest concerns of any self-employed person, including freelance writers, is health insurance. Many people avoid freelancing exclusively because they are afraid of ending up without health care benefits. Some self-employed individuals go without coverage because they assume they can't afford insurance, or because they don't know how to go about obtaining a policy. However, getting insured isn't as difficult or as costly as many people anticipate. Plus, under current U.S. law, freelancers may be eligible to deduct the full cost of their monthly insurance premiums on their taxes.

Ask your employer about COBRA before you quit your day job. Before you quit your job, make sure to talk to your human resources department about continuing your current insurance coverage under COBRA. You should be allowed the option to pay out of pocket to keep your existing coverage for up to 18 months after you quit your job, or until the time you are able to obtain other insurance (under the 18 month limit). The amount you will have to pay varies greatly and will depend on your current plan and coverage. COBRA may not end up being the most affordable option for you, but until you are able to find other insurance, it may be the most practical option.

Consider your coverage needs. Taking into account how healthy you are is a good start, but you will also want to think about the future. If you are planning to have children, for example, you will want to look for a plan that will cover those related expenses. A big consideration for everyone, even healthy people, is emergencies. Being completely uninsured can cause a real financial burden if you happen to need emergency surgery or get in an accident. If you only plan to freelance for a short time, you might want to investigate short-term insurance, which is available for terms of six months or less at a lower cost than long-term plans.

Weigh premium costs and deductibles. If you rarely need medical attention and only go to the doctor once or twice each year, you may want to consider a plan with a higher deductible but lower monthly payments. This way, you will only have to pay the deductible if you need emergency care or other care that is not covered until you pay the deductible. Often, plans cover one or two doctor visits plus prescription costs without your having to pay the deductible. If you need a lot of medical attention, see many specialists, and want to keep your old doctors, a plan with a moderate deductibles and average premiums might be best for you.

Research individual plans and group plans. Individual plans, or plans purchased by you directly through an insurance company, are more costly than group plans. You can get insured through a group plan by joining a self-employment group or a writers association. Or, check with your local chamber of commerce. Many freelancers don't know that these groups exist, but they are definitely worth checking into.

Learn about tax deductions. If you are a self-employed/freelance writer, your own health insurance premiums may be tax-deductible. To be eligible for this deduction, you must have reported a net profit for the year that exceeds the cost of your health insurance, and you can't have been eligible to receive health insurance benefits under your spouse's policy or your employer's policy (if you still have an employer for that year).

Amy Derby is a freelance writer and self-publishing author. She is the owner of write-from-home.com, a free website dedicated to helping new freelance writers learn how to make money writing from home online.

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