[Editor's Note: The following guest post was submitted by Seattle-based hospitalist and physician blogger, The Locum Tenens Guy. The Locum Tenens Guy has successfully practiced locum tenens across many states and says he's “obsessed with career freedom and flexibility”. We have no financial relationship.]
Many physicians interested in locum tenens work full-time are concerned about health insurance – how to get it, how much it will cost, and what kind to get. It’s a little ridiculous that we as physicians have to stress about these things, but considering the state of healthcare in the United States, it’s not surprising. This post will help walk you through your options and things to consider, but before you get started, start thinking about what your budget is and how much coverage you need.
What Are My Options For Health Insurance?
First, let’s discuss your options for coverage and how to find them. This might be daunting if you’ve never had to secure your own health insurance, for example, if you’ve only held employed positions or you’re fresh out of residency. Having employer-provided health insurance definitely makes life easier, but if you don’t have that, where do you even begin? Let’s look at the options:
#1 Health Insurance Exchange/Marketplace
Perhaps the easiest place to start is to search for available policies through the Affordable Care Act health insurance exchange or marketplace (Healthcare.gov). Here you can search for coverage options by state and apply online during open enrollment.
#2 Individual Healthcare Broker
Another option is to seek out an individual broker. This person may represent several different companies and can help you decide on the best option, based on what you need and what your budget is.
#3 Your State Medical Society
If you’re a member of your state medical society, you can also inquire there. Some state medical societies offer sponsored health plans for individuals and families but may also have limited enrollment windows.
#4 National Association for the Self-EmployedNASE) can get access to a number of plans for individuals and small businesses.
If you’ve recently been employed, you could consider obtaining coverage via COBRA from your previous employer. It’s definitely expensive, but at least you’d know what you’re getting.
It’s important to note that you will need a ‘home base’ so to speak, and a physical mailing address before securing coverage.
Cost of Self-Employed Medical Insurance
The biggest concern these days when it comes to health insurance is the cost. Your overall cost depends upon multiple factors, including:
- Number of dependents (if any)
- Monthly premiums
- Coverage of care, in- and out-of-network
According to an eHealth analysis of ACA plans, the average monthly premium was $393 for individuals and $1021 for families in 2017. Generally speaking, the more you spend on your premium, the better your coverage will be, and the less you’ll have to pay out-of-pocket for healthcare expenses. On the other hand, high-deductible plans have lower premiums but a higher maximum for how much you have to spend before your care is fully covered (the threshold for a high-deductible plan according to the IRS is $1350 for an individual and $2700 for a family ($1400 and $2800, respectively, for 2020)). I personally have a high-deductible plan, and my premium is $1500 per month for a family of four. If you’re younger and have no known medical conditions, you may be able to get by with a high-deductible plan. But there’s a risk that you’ll incur a ton of expenses if something unexpected occurs.
Also, consider whether benefits are in- or out-of-network. As a locums physician, you may be moving around frequently or working in more than one state at once. If your home base is in one state, but you’re working in another, will your services be considered out-of-network, and therefore, more expensive? The answer is most likely yes.
You might be paying out the nose for insurance premiums or out-of-pocket expenses, but you can still try to recoup some of that at tax time. Medical and dental expenses, including health insurance premiums, are tax-deductible IF they exceed 7.5% of your adjusted gross income. Examples of expenses that qualify are listed here.
Additionally, self-employed individuals are eligible for the self-employed health insurance deduction which can reduce the tax burden.
Of course, it’s always best to consult your tax advisor or accountant. Any material here should not be considered tax advice.
Health Sharing Plans
If you haven’t heard of healthcare share plans yet, it may be time to look into them. Healthcare sharing ministries are faith-based communities (not insurance plans) where medical expenses are shared. There is no monthly premium but a set monthly contribution amount, and after you’ve paid your predetermined maximum amount for the year, your remaining bills will be covered by the shared network. There are various options in terms of monthly contributions and yearly maximums, which you opt into when you sign up. Although there do not appear to be limited time windows for enrollment, these plans may not cover expenses related to pre-existing conditions. Searching ‘health share plans’ will return at least a handful of options, if you’re interested.
If you’d rather go the traditional route, and you need coverage for yourself and your family, you could consider getting separate plans based on your needs. For example, if you have a dependent with pre-existing conditions and/or are expecting more costly procedures or prescriptions, you could get ‘better’ or more traditional coverage for your dependents and a ‘catastrophic’ plan for yourself (assuming you don’t have the same expectations). This would save money by paying a lower premium for your own plan.
In the end, how to proceed is ultimately up to you, but at least now you know you have some options.
Are you self-employed? What health insurance hacks or tips to you have? Comment below!