By Kelsey Mulvey
Becoming a full-time freelancer has its perks. You can set your own hours, work on projects you’re really passionate about and spend your days holed up in a coffee shop (psst… have you checked out our favorite, freelancer-approved cafés?).
The downside to leaving your full-time job? No healthcare. You can rely on your parents’ healthcare if you’re 25-years-old or younger, but the moment you turn 26, you’ll have to start paying for it out of pocket.
So what gives? Is healthcare expensive? How do you figure out which plan is best for your needs? We’re answering your burning questions below.
How expensive is health insurance?
Relax, healthcare isn’t as expensive as you’d think.
“From my experience, I’ve seen clients pay as little as $0 and as much as $1,000 a month for a family of four,” said Shannon McLay, founder of the Financial Gym.
According to The Balance, the average American with a federal marketplace plan spent $106 a month after subsidies. Not exactly chump change if you’re living paycheck to paycheck, but it’s feasible. If you want to keep costs down, McLay recommends choosing your plan wisely.
“The best way for people to control healthcare costs is by picking the appropriate plan for their needs,” she added. “If you don’t have ongoing healthcare needs like regular doctor visits or prescriptions, then it probably makes senses to choose the high deductible insurance plan. The monthly costs are typically the lowest, but you also have access to a Healthcare Savings Account, which gives you triple tax protection and the ability to save money over time.”
When should I sign up for healthcare?
No, you can’t sign up for health insurance whenever you please.
“If you are going to get healthcare on your own through the exchanges, the only time you can apply is during open enrollment, which is November 1st to December 15th for coverage starting January 1st,” said McLay. “If you miss this window, the only other time you can start new coverage is with a ‘Qualifying Life Event’ like losing your job or getting a divorce. If you work for a company, they typically have a similar open enrollment period from October to November that will lock in your coverage for the next year.”
What are you waiting for? Sign up for healthcare, stat.
How do I know which program is best for my needs?
Don’t know whether your should sign up for an EPO or PPO plan? Don’t even know what EPO and PPO mean? You’re not alone. When it comes to selecting the best plan, focus on what your needs are as a patient.
“HMO plans [Health Maintenance Organization] are often lower cost, but require patients to choose a primary care doctor (PCP) and get referrals for all other doctors through that PCP in order to see a specialist,” said Sara Rowghani, Senior Vice President of Marketing at Oscar. “PPO plans [Preferred Provider Organization] are the most flexible and come with a higher price tag, but partially cover out-of-network visits and don’t require any referrals for specialists. EPO plans [Exclusive Provider Organization] fall somewhere in between. On an EPO plan, you don’t need referrals to see in-network specialists, and you don’t have to choose a primary care physician, but you pay full price if you go out of network. All of Oscar’s plans on the individual market are EPO plans.”
Translation: If you only need a checkup here and there, an HMO plan is the best bang for your buck. But if you’re not willing to part ways with your favorite dentist, it’s worth shelling out more money for a PPO plan. Rates and network doctors vary by healthcare provider, so do your research before signing up for a program.
How do I select the best insurance provider?
Aetna, UnitedHealth, Blue Cross Blue Shield… how’s a freelancer supposed to choose from dozens of providers? Luckily, you don’t have to go at alone.
There are tons of services, like Oscar, that do the legwork for you, making the entire process easy and, well, kinda enjoyable.
“When a member signs up for coverage through Oscar, they can rest assured that they’ll be getting a simple, easy-to-use health care experience,” said Rowghani. “Every Oscar plan comes with a personalized Concierge Team made up of three care guides and a nurse clinician, a free, 24/7 telemedicine service and a tightly integrated, curated network of first-rate physicians and hospitals. We offer health plans to both individuals and small businesses.”
If you want to understand all those tricky healthcare nuances, McLay recommends checking out Policy Genius.
“[The company has] a team of experts that you can call and ask questions of, and I highly encourage you take your time and do the research before you select [a plan],” she said.
But what about my extra costs (ie: birth control, physical therapy)?
Money will be tight for the first few months of your freelance career. Since you won’t receive a fixed salary, but still have pills to pay, you’ll probably have to cut back on going out to dinners, taking cabs across town, and yes, your shopping habit. Fortunately, becoming your boss doesn’t mean you’ll have to pay an arm and a leg for your birth control prescription.
“Birth control is considered an ‘Essential Health Benefit,’ which means that health insurers offering plans on the individual market have to cover it,” Rowghani explained.
As for other electives like your physical therapy? It varies by provider.
“Insurers might pay a percentage of the cost, or they might pay a fixed amount while a patient pays a fixed copay,” she adds. “Insurers often have pre-negotiated rates with doctors to save their members money for these types of services.”
Before you sign off on any health insurance, take some time to evaluate which services you actually need. You might love going to the chiropractor, but is it really necessary?
Kelsey Mulvey is a New York-based writer. She has written for several publications such as The Wall Street Journal, Time Out New York, LuckyMag.com, Business Insider, Taste of Home, NYMag.com and Wallpaper.com. Check out more of her work at KelseyMulveyWrites.com and follow her on Instagram and Twitter.