BENEFITS

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Health Insurance Is Important to You and Your Business

QUICK SUMMARY

One of the first and most critical to-do’s for any business owner is to obtain health insurance as soon as possible. The most important reason for this is to protect yourself and your family from losing more than just your good health.

Without health insurance, your family and business may be one major illness or injury away from bankruptcy. (In fact, according to a 2013 study conducted by NerdWallet Health, medical costs are the leading cause of personal bankruptcies in the U.S.) That can have devastating consequences for not only you and your family, but for your business — which means your employees, partners, and their families suffer the losses as well.

There are also legal reasons to acquire health insurance. With passage of the Patient Protection and Affordable Care Act (ACA), to avoid being assessed an IRS penalty, self-employed individuals are now required to have health insurance coverage. On the bright side, according to the the 2014 Small Business Success Study, compared to 2012, fewer small business owners feel that healthcare costs represent a major risk to their business.

How to Obtain Individual Health Insurance

Generally, you can find individual health policies in one of two ways:

  1. Call an independent insurance professional who specializes in health insurance. You may want to ask your colleagues, peers and friends to recommend someone.
  2. Visit your state’s online health insurance exchange, which was created expressly in accordance with the ACA. Search online for your state’s health insurance exchange. If your state doesn’t have a health exchange, visit the federal government’s site and click on “Individuals & Families.”

NOTE: Some lower-income individuals may qualify for premium subsidies or cost-sharing subsidies. If you are one of them, you can only receive these subsidies through a state or federal health insurance exchange.

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Available Through Professional and Trade Organizations

Typically, group health insurance is far more affordable than individual insurance. Check if you qualify for a group health plan through a professional, trade or membership organization. Following are examples of organizations that have group plans available to their membership:

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Advantages of High Deductible Policies

The higher your deductible (the amount you pay out of pocket each year before the insurance company begins covering your care), the lower your premiums. As a result, many entrepreneurs purchase high deductible health plans, or HDHPs—also known as “consumer directed health plans”—to keep their monthly premium payments low.

Whether you’re seeking insurance privately through an agent/broker or via an online exchange, you’ll find that HDHPs are typically among the most affordable in terms of premium payments. And, under the ACA, many HDHPs cover preventive services—prenatal care, cancer screenings, children’s dental checkups, etc.—without regard to your deductible.

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