?20 to 30 per cent of the working-age population in the United States and the European Union engage in independent work.? ? Independent work: Choice, Necessity, and the Gig Economy, McKinsey Global Institute, 2016. It is estimated that 34% of the population in the US are working as freelancers. With many companies looking to hire skilled individuals on a contract basis from app development to content writing, freelancing is quickly becoming a lucrative career option for many young workers. This brings to the fore the importance of benefits provided by the companies to the freelancers working for them. Insurances strike out as an important factor, be it health insurance or life insurance. With most professionals preferring to work independently, it is imperative to understand the methods to acquire insurance and the reasons for doing so.
Affordable Care Act
The Affordable Care Act has revolutionized healthcare with Obama spearheading the operation. If you are a legal U.S. citizen and low income with a pre-existing condition or at risk for a major disease, you can opt for the Affordable Care Act. The act provides access to health insurance for all Americans, including those without full-time employment. The ACA has elements designed to facilitate a flexible assessment of your income. It is an affordable, reliable, and readily available insurance to all freelance workers.
The Freelancer?s Union with the tagline, ?Building a better future for independent workers? cites itself to be the voice of 57 million freelancers. Upon visiting their website, you can shop for health insurance plans and invest in advocacy for freelancers. They also have options for building your social network and protecting your business. In addition, it provides information on how to acquire health care including individuals over the age of 65.
For US citizens who are enrolled in an HDHP (High-deductible health plan), the HSA account can prove to be beneficial. It allows you to save money in your HSA account before you pay the taxes and use those savings to fund health care expenses. Further, there are options for saving up till retirement as a safety blanket. To be an eligible individual and qualify for an HSA, you must be covered under an HDHP, have no other health coverage, not be enrolled in Medicare, or be dependent on anyone else for your tax returns. Contributions to the HSA made by the freelancer?s employer may be excluded from the gross income.
Consolidated Omnibus Budget Reconciliation Act (COBRA)
On the occasion that you were provided health insurance with your previous employer and have transitioned to working in a freelance setting, you may be able to continue having your healthcare coverage through COBRA. Although the plan is not very affordable, it can be a reliable method of acquiring health insurance.
Insurance through spouse
For freelancers that are married, it is possible to be covered under their spouse?s health insurance plan. While not an independent method of obtaining insurance, this can be an option if desired. Various healthcare insurances cover the spouse in terms of long-term health problems or acute concerns. While private plans may cost more money, it can be an option to consider if you?re unable to acquire insurance on your own.
Keeping the above points in mind it is important to choose an insurance plan best suited to your needs based on your financial capabilities. In addition, a few things to consider are to start early, do a comparison between policies, and to consider your future needs.