How Much Does Self Employed Health Insurance Cost on Average?

Updated on August 6, 2020

Almost 30% of Americans are self-employed. That’s about 44 million people. If you are one of those lucky people, congratulations!

Being self-employed means you control your schedule, strategy, and decisions related to your business. However, this also means you are on the hook for self-employed health insurance.

But don’t worry – you can learn everything you need to know about the cost of self employed health insurance right here. Just keep reading.

Being Added to an Existing Plan

First, you may be eligible for coverage under a family member, spouse, or partner’s insurance policy. If you are under the age of 26, you may be added to a parent’s health insurance plan as well.

Depending on that person’s policy and coverage, it may save you money to be a part of their plan instead of trying to purchase your own.

In 2020 the average national cost for health insurance for an individual and family was $1,152. For the individual alone it is around $456.

Medicare or Medicaid

If you are 65 or older or you have a disability, you may be eligible for Medicare. There are 4 different parts of this plan which all contribute to the overall cost you would have to pay.

The cost of Medicare varies, but on average the payment due is about $145 to $290 a month.

If your income is below a certain amount, you may be eligible for Medicaid. You can check the health insurance marketplace and enter your income and residence to find out if you qualify.

Be aware that Medicaid does not cover all forms of healthcare in all states. Furthermore, the overall out-of-pocket cost from Medicaid can vary from anywhere between $120 to $300 a year.

Self Employed Health Insurance

If you are self-employed and work independently, you can purchase individual health insurance. This is the equivalent of buying a health insurance plan similar to how you would buy a cell phone plan. 

The average health insurance cost for an individual plan is about $388 per month. If you require insurance for dependents, like children, the cost on average is about $1,520 a month. 

The cost for individual health insurance has increased over the past few years but remains an overall lower cost than group insurance.

You can access the marketplace via Open enrollment is between the beginning of November and the middle of December, but you may still qualify to purchase insurance outside of that time period based on certain life events.

Alternatives to Individual Health Insurance

If you anticipate that you will not be self-employed for a long period of time or you cannot afford individual health insurance, you can buy short term health insurance.

Short-term health insurance usually provides coverage for up for 12 months. You may be able to renew short-term health insurance for up to 3 years depending on the situation.  

If you still believe you cannot afford health insurance, check out this article on what you should do.

Protect Your Health and Your Wallet

Now you can feel more confident about buying the right self employed health insurance for you. 

Take your time, do your research, and compare plans before deciding. Find cost-saving measures in other areas of your life to prioritize a budget for health insurance.

For more helpful healthcare information and news, browse our other blogs.

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