Health insurance is a much talked about aspect of small business today. Employees want it, and need it. Small business owners need it as well, and the prices are high.

The first thing to keep in mind with health insurance is that all policies are not the same, and neither are all health insurance companies. Shop around to get the best rates of course, but don’t assume that the cheapest is naturally the best. When you find a policy that fits your budget, check out the company. Make sure that it has an adequate rating, preferably A plus. Check with your state insurance commission and assure yourself that the company pays claims when they are filed.

Next, decide if you will be best served with a traditional insurance plan, or a PPC or HMO. HMO stands for Health Maintenance Organization. PPO means Preferred Provider Organization. This is a network of healthcare providers who offer services to the members of participating health plans for a lower than usual cost.

Usually these doctors and hospitals are made known to you through a list provided by the PPO. You can see another doctor under a PPO, but it is more expensive to see someone not a part of the network. In that case only a percentage of the claim is paid. With an HMO you are restricted to physicians who are members of the HMO.

After checking out the available options, also consider a high deductible combined with a Medical Savings Account. With a high deductible, usually $5,000, you are considered self-insured for the first $5,000 in medical expenses, but have the insurance available for catastrophe or unusual circumstances. This leads to very low premiums. Combining that with a Medical Savings Account is a good combination for many people.

The Medical Savings Account is much like an IRA for retirement. With this program you put aside tax-free income into the savings account, that can only be used for medical expenses.
When checking these programs out, remember that you have many options.

Don’t be afraid to take the details of a plan one company is offering into another insurance office to let them compare and make a competing offer. Health care is important, and making the right decision now could help you in many ways, including financial, down the road.

For a more in-depth look at health insurance for the self employed visit: http://simplehealthcoverage.com

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Filed under: Articles • Running A Business • Self Employment

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