Shopping for solopreneur health insurance? Whether you’re already a solopreneur or are considering quitting your full-time job to focus on your venture, you’re probably aware that you don’t receive job-based health insurance benefits when you’re self-employed.
Solopreneurship is a juggling act. Between meeting with clients, drumming up new business, and executing all the work yourself, you probably don’t have a ton of time to research affordable health insurance that suits the needs of the solopreneur life.
But don’t worry – you have options, and this solopreneur health insurance guide lays them all out.
What is a Solopreneur?
A solopreneur is someone who founds and operates their business independently, without the help of a co-founder or W-2 employees. They manage every aspect of their business, from day-to-day operations to delivering the product or service that keeps them afloat.
The solopreneur life is all about doing things, well, solo! While an entrepreneur is someone who dreams of scaling their business into something bigger, a solopreneur is more concerned with keeping their business manageable for one person.
Examples of solopreneur jobs include:
- Freelance writer
- Graphic designer
- Web designer
- App developer
- Business consultant
- Virtual assistant
- Tax preparer
- Social media manager
- Social media influencer
- E-commerce seller
- Personal trainer
Solopreneur vs. Entrepreneur: What’s the Difference?
The terms “solopreneur” and “entrepreneur” are often used interchangeably, and while they share some similarities – both found and run their own business – there are a few noteworthy differences between them.
1. A solopreneur is the founder and the employee.
A solopreneur manages every aspect of their business. They are the founder and the person solely responsible for executing the work that keeps them in business. A solopreneur may hire a contractor or freelancer, but they don’t usually rely on delegating tasks to other people. However, an entrepreneur often outsources tasks to other people so they can focus on managing the business itself.
2. Solopreneurs pursue a singular focus.
A solopreneur normally offers their product or service to a particular niche, which keeps their business manageable for one person. They aren’t looking for rapid growth – they’re focused on building a steady customer base that keeps their business profitable.
For example, a solopreneur who offers graphic design services to small businesses may offer a set menu of services to clients that they know they can execute. But an entrepreneur who runs a creative agency that employs a dozen people may provide graphic design, branding, and video production services because they have a bigger team, and they can add more services as the team grows.
3. Solopreneurs are not trying to scale.
Many entrepreneurs want to grow and scale their business to eventually sell it for a profit and move on to other ventures. Solopreneurs, however, are looking to create a profitable business that they can continue to operate and live off long-term.
4. Solopreneurs keep most of their profits.
Running a team-based business is fraught with expenses like office space, salaries, and benefits – expenses a solopreneur doesn’t have. Solopreneurship is lean by design, which means you get to enjoy the majority of your profits.
How Do I Get Short-Term Health Insurance as a Solopreneur?
If you’re a solopreneur, you’re probably used to doing things on your own. But you’re not on your own when it comes to finding affordable health insurance coverage. You’ve worked hard to get to this point, so it only makes sense to protect everything you’ve worked for with health insurance.
There are a few different health insurance options out there that may suit the needs of the solopreneur life:
1. Short-Term Health Insurance
If you don’t have any pre-existing conditions, are not pregnant or planning a family, do not need mental health services, and don’t qualify for tax subsidies through the Affordable Care Act (ACA), a short-term health plan could be a smart option. It offers benefits for:
- Doctor visits
- Urgent care
- Child immunizations
- Ground ambulance trips
- Emergency room care
- Emergency surgery
- Inpatient/outpatient hospital care
- Outpatient physical therapy
- Home health care
- Diagnostic testing and interpretation of results, depending on the state in which you purchase your plan
- Prescription medications, depending on the state in which you purchase your plan*
Short-term health insurance offers lower monthly premiums than many ACA-compliant plans from the Health Insurance Marketplace because it doesn’t cover pre-existing conditions or all 10 essential health benefits. If you don’t want all of the coverage available with an ACA-compliant plan, then short-term medical insurance could be a viable option.
You can apply for short-term health coverage at any time, unlike the Health Insurance Marketplace, which only accepts applications during an open enrollment period or if you have a qualifying life event. Plus, short-term health insurance can cover spouses and dependents if they meet the plan’s medical requirements, and you have the option to renew your coverage for up to two additional years.
2. ACA-Compliant Plans Through the Health Insurance Marketplace
If you want the benefits that comprehensive major medical insurance offers, consider shopping for coverage through the Health Insurance Marketplace. The ACA-compliant plans offered through the Marketplace include coverage for pre-existing conditions and all 10 essential health benefits:
- Ambulatory patient services
- Emergency services
- Hospitalization (like surgery and overnight stays)
- Pregnancy, maternity, and newborn care (both before and after birth)
- Mental health and substance use disorder services, including behavioral health treatment
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Laboratory services
- Preventive and wellness services and chronic disease management
- Pediatric services, including oral and vision care (adult dental and vision coverage are not essential health benefits)
You can also purchase plans with dental and vision benefits through the Marketplace.
If you’re a solopreneur and your income is below a certain level, you may qualify for subsidized coverage that could lower your health insurance costs.
Your eligibility for an ACA tax subsidy (premium tax credit) is determined by income. To qualify for a premium tax credit, your household income must be between 100% and 400% of the federal poverty level. If you live in a state with expanded Medicaid coverage, your household income must be below 138% of the federal poverty level to qualify.
3. Health Insurance Coverage Through a Client
Are you a fitness instructor who regularly teaches at the same gym or studio? A freelance writer who’s on staff for a particular publication? If so, it might be worth asking your client if they offer health insurance to their employees.
Just because you aren’t full-time doesn’t mean you can’t qualify for coverage. Many states have laws that require employers to offer health benefits to employees who work a certain number of hours per week. You won’t know until you ask!
4. Health Insurance Coverage from a Union or Membership Organization
Unions and membership organizations like the Freelancers Union and the National Association for the Self-Employed (NASE) offer health insurance options for solopreneurs. Keep in mind that if you seek coverage through a membership organization like the NASE, you would need to pay a membership fee in addition to the cost of your health insurance.
How Much Does Solopreneur Health Insurance Cost?
So, how much can a solopreneur expect to spend on individual health insurance? Several factors determine health insurance costs, including your age, ZIP code, tobacco use, and whether you need coverage for yourself or a spouse or additional family members.
The type of plan you choose will also affect your health care expenses. On the one hand, a short-term health insurance plan may be an affordable option if you don’t want coverage for things like pre-existing conditions, pregnancy care, or mental health services, and you don’t qualify for an ACA tax subsidy. On the other hand, an ACA-compliant plan could be a smart option if you have a pre-existing condition or qualify for subsidized coverage.
Weigh your options. Which coverages do you absolutely need? How much are you willing to spend?
Vera Health can help you find the health insurance plan that makes the most sense for your situation. Visit our homepage and adjust the slider to get started.
When Can a Solopreneur Enroll for Health Insurance Coverage?
ACA-compliant plans are traditionally available during the annual open enrollment period. However, there is an exception if you are experiencing a qualifying life event, such as quitting your 9-to-5 to pursue full-time solopreneurship.
Short-term health insurance doesn’t have an enrollment period and instead operates on a rolling basis. That means you can apply for coverage any time, and your benefits could kick in as soon as the next day.* Need affordable health insurance? A short-term insurance plan might be right for you.
If you’re a solopreneur, you’re used to relying on yourself to get the job done, but you don’t have to rely on yourself to find an affordable health insurance plan. Vera Health is here to help. Call us at 888-499-1187 to speak with a Vera Health pro or visit us online to learn more about your choices and whether a short-term medical plan is a good fit. We can help find the right coverage for you, even if it isn’t with us!
- The Entrepreneur’s Guide to Getting Short-Term Health Insurance
- The Freelancer’s Guide to Getting Short-Term Health Insurance
*Covered services may be subject to waiting periods, visit limitations, deductible, coinsurance, or copays, and/or benefit maximums depending on the plan you purchase.
Short Term Medical coverage is not required to comply with federal market requirements for health insurance, principally those contained in the Affordable Care Act. Be sure to check your policy carefully to make sure you are aware of any exclusions or limitations regarding coverage of pre-existing conditions or health benefits (such as hospitalization, emergency service, maternity care, preventive care, prescription drugs, and mental health and substance use disorder services). If this coverage expires or you lose eligibility for this coverage, you might have to wait until an open enrollment period to get other health insurance coverage.