Today’s 10 Best Health Insurance Options for Independent Consultants
From the Affordable Care Act to zero-cost sharing and everything in between.
Today, you have more ways than ever to get health insurance as an independent consultant. Photo by TopSphere Media on Unsplash.
So you want to be a Choosy Consultant*. What’s holding you back?
If you’re like many of my clients, it may be navigating that dreaded maze called health insurance.
Fortunately, there are more health insurance options available today than ever before.
“Access to health insurance is no longer an obstacle to your success and choosy lifestyle as an independent consultant.”
In this post, I’ll explore the many health insurance coverage options available for the independent consultant. I know you will find a solution that fits your needs.
*Choosy Consultant defined: You’re independent and work on your terms… whenever, wherever, and for whomever you want.
Today’s 10 Best Health Insurance Options
I recommend traditional health insurance options, others that may be new to you, and a few solutions for niche cases.
Spousal coverage through his/her/their employer-sponsored insurance
Individual or family coverage through the ACA marketplace or directly from insurers
Medicare for those over 65 years young
Professional Association Health Plans (PAHPs) set up specifically for solopreneurs, freelancers, and other gig workers
Healthcare Sharing Ministries (HSMs), even if you’re not the religious type
Employer-sponsored insurance if you have an accommodating W2 employer
COBRA coverage for 18 months (and sometimes up to 36 months)
Small business plans, if you have non-family employees who also need insurance
State-based health insurance if you’re genetically handicapped or have a chronic condition
International healthcare. Live abroad in Mexico or Europe or elsewhere, and get coverage there!
In this post, I won’t discuss health insurance options for individuals and families with low incomes. However, these options do exist: Medicaid, Children’s Health Insurance Program/CHIP, and other state-run insurance programs.
My Health Insurance Journey from 2001 to Today
I was married at age 25. The year was 2001. My beautiful wife had (still has) a chronic disease, so health insurance is a critical concern for us.
In my 20s, we required group coverage with no gaps, so preexisting conditions didn’t bite us. I studied 100+ page health insurance plan documents at every employer. I always wanted to start my own company. But individual, private insurance didn’t work for us.
Other possible options? My wife had a state-based plan for the genetically handicapped when in college. But it wasn’t exactly what we needed. I investigated health insurance through Professional Employer Organizations (PEOs), but it too was unsuccessful.
The Affordable Care Act (ACA) in 2010 changed everything. Ignore any politics for a moment; the ACA made insurance coverage more available. Period. No more preexisting conditions. Gaps in coverage no longer matter. And it’s subsidized to be affordable. Wow.
In 2017, I became an independent consultant at age 41. Yep, it took me 16 years! I made the change by using COBRA for 18 months and then bought a small business health plan. Now I’m investigating ACA coverage options.
I coach independent consultants. I hear the very same concerns that I once had about insurance coverage: “How can I quit my W2 job when I need the insurance?” “I can get Medicare at 65, but I’m only 45. What do I do?”
I’m uniquely qualified to discuss your health insurance options. And there are many more today than there were in 2001 when I began my journey. Let’s get on with it.
Three Insurance Options You Know and Two You Might Not
These health insurance options are easy to qualify for. (Of course, Medicare has an age requirement.)
#1 Your Spouse’s Employer-Sponsored Insurance
If you have a working spouse and they have employer-sponsored insurance, you’re golden. Your spouse’s Preferred Provider Organization (PPO), Health Maintenance Organization (HMO), or High Deductible Health Plan (HDHP) covers you and your family. You have the freedom to ignore health insurance as you consult independently.
#2 ACA or Direct Individual and Family Coverage
This health insurance is purchased directly from insurance companies or through the Health Insurance Marketplace, often with a subsidy. These plans offer varying levels of coverage. Types include Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), Exclusive Provider Organization (EPO), and Point of Service (POS) plans.
#3 Medicare
Medicare is a federal program that provides health coverage for individuals age 65 and older, as well as some younger individuals with disabilities. I include this option because I support a #neverretire movement. In it, we don't retire but continue to work on our terms late into life as Choosy Consultants. Medicare is a great option once you or your spouse turns 65.
#4 Professional Association Health Plans (PAHPs)
PAHPs are designed to provide health insurance coverage to individuals or small businesses that are members of a professional or industry association. PAHPs limit their eligibility to the groups they serve. Their plans may offer less comprehensive benefits. Always thoroughly investigate any PAHP and its associated membership against your unique healthcare needs.
These five PAHPs make sense for independent consultants and provide major medical. You always need a reason to shop at Costco, right?
These three PAHPs provide supplemental medical insurance only.
#5 Healthcare Sharing Ministries (HSMs)
HSMs are faith-based organizations whose members share and cover each other’s medical expenses. They are not traditional health insurance providers but function as a healthcare cooperative. In 2023, HSM membership exceeded 1.7 million people, so these are real businesses.
Costs to members are typically less than traditional insurance. Yet, plans and benefits should be reviewed in detail because HSMs are not insurance, and legal protections are different. For example, certain pre-existing conditions and preventative care may not be covered.
These are the ten largest HSMs.
And don’t write off HSMs because they are faith-based organizations. The level to which members must affirm their faith varies widely. Christian Healthcare Ministries members, for example, must adhere to a Statement of Faith, attend regular church services, and provide documentation of their church attendance and pastor’s affirmation. Medi-Share coverage only requires all adult members age 18 and older to attest to a personal relationship with the Lord Jesus Christ. Zion Healthshare and Sedera are secular HSMs.
Five Niche Options That Could Fit Your Situation
These options often satisfy special circumstances or unique health insurance needs.
#6 Your (Creative) Employer-Sponsored Insurance
Consider if you’re an employed staff consultant not yet ready to go independent.
In 2007, I took two months off to remodel a cabin we bought in Northern Wisconsin. I worked closely with my employer, Point B Consulting. Keeping my health insurance required I maintain more than a 50% part-time workload per quarter. I structured the time off to remain 67% part-time in Q2 and Q3. If you have a flexible and willing employer, it’s possible to keep your health insurance throughout an extended leave.
#7 COBRA Coverage
Consider if you’re just leaving your employer and transitioning to independent consulting.
Federally mandated COBRA allows eligible individuals to continue their group health coverage for 18 months (and sometimes up to 36 months). You maintain your existing health plan, benefits, and medical network. But the cost is higher since you assume the portion of the premium your employer had paid. I recommend this coverage as a bridge to more permanent health insurance options.
#8 Small Business Health Plans
Consider if you employ at least one non-spouse consultant or assistant in your consulting practice.
My current insurance is a United Healthcare small business plan purchased from the online insurance broker eHealth. Generally, to qualify for a small business plan, you need to employ at least one individual who is not your spouse. And at least 60%-75% (based on the insurer) of eligible owners and employees, combined, must enroll in coverage. Specific regulations differ by state, so I recommend working with a broker like eHealth.
#9 State-Based Health Insurance
Consider if you or a family member has a qualifying genetic handicap or chronic illness.
State health insurance programs for the chronically ill can vary by state. They often fall under Medicaid or other state-specific programs. To find a list of programs, visit your state’s official Medicaid website or contact your Department of Health and Human Services. Two programs that I have experience with:
While not always the most comprehensive plans, these programs are guaranteed health insurance coverage for the most vulnerable. And that is a great thing.
#10 International Healthcare
Consider if you’re an international, remote worker, or digital nomad.
If this is you, I’m jealous. COVID drove many wonderful changes to working arrangements. I know several people who work 100% remotely from overseas. Mexico is also a great option. If you live outside of the United States, investigate the country’s healthcare system. I researched Portuguese healthcare recently and found its costs to be lower than in the U.S. I also found the medical care to be equal; there is even a national lung transplant program in Lisbon.
“When you’re ready to live life as a Choosy Consultant, be confident that the right health insurance option exists for you.”
Take it from me, who obsesses over my family’s healthcare needs. If today’s health insurance products can meet my strict requirements, they can likely meet yours too! Don’t let access to health insurance hold you back from designing your perfect life.
P.S. I did mention the Affordable Care Act. But I also promised you zero-cost sharing. Okay… With an ACA plan, your preventative care services are covered 100% by your health plan…at no cost to you. You’ll have zero-cost sharing. I did it: From the Affordable Care Act to zero-cost sharing and everything in between.
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Brian Herriot obsesses over health insurance from his home in Alameda, California, and cabin in Hazelhurst, Wisconsin. He prefers to prepare financial freedom plans for consultants and other mid-career professionals in one-week sprints. Check out his take on a new and different kind of retirement at choosyconsultant.com.