The Health Insurance Dilemna for Entrepreneurs: How I’m Getting Good Coverage

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 I’m on my own for the first time ever to get health insurance for my family of four. We’ve always had an employer that provided us with health insurance until my husband got laid off in February of 2015. We paid for 18 months of COBRA insurance coverage in order to keep our good preferred provider organization (PPO) health insurance plan. Then the day came when our 18 months was up and my husband still did not have a full-time job. We were panicking because we were treading in unknown waters and from everything we’d heard, it was not going to be easy going.

We learned that no matter how much you pay, you still can’t buy a good health insurance policy in the current health insurance market. That’s because the only policies available in the individual market are health maintenance organizations (HMOs). So now we pay a lot of money (more than our mortgage payment) for health insurance, and that health insurance only provides us with a benefit if we spend more than our deductible of $3,500 per individual ($10,500 per family).

Now in an average year, we are not spending anywhere close to $3,500 per person. So what we’re really paying for is health insurance for major medical expenses, for if someone needs surgery or is in the hospital.

As luck would have it, I found out in August (with only one month of COBRA coverage left) that I would probably need minor surgery. Because of the testing involved to see if I even qualified for the surgery, I wasn’t able to schedule the surgery before September 1 (when our health insurance coverage changed to HMO). I actually had my surgery scheduled for September 12, but the HMO wouldn’t pay for it because the doctor was out of network. And I certainly couldn’t pay for it since it cost about $20,000.

So I searched to find an in-network doctor that did this specialized surgery. When I found a doctor, I got a referral to see him from my primary care physician (PCP). So I thought I was set and had all my ducks in a row to have surgery soon so I could get back to healthy!

Little did I know that there was a problem with my magnetic resonance imaging (MRI). My new doctor couldn’t get the information he needed from the MRI because it was done incorrectly. He did not have the information he needed to proceed with my treatment and I would need to get a new MRI. It would only cost me $3,500 (my deductible). Being frugal, my doctor advised me to try to live with my minor symptoms until January. Then we could proceed with the MRI and I would meet my annual deductible at the beginning of the year in order to maximize my benefit from my health insurance. I agreed it made sense to wait, and while I’m waiting I’m pursuing alternative natural remedies for my symptoms.

I loved my doctor for being frugal and caring about his patients’ finances. I hated that I needed additional testing because it wasn’t done right the first time. Heck, after the testing was done I still might not be a good candidate for the surgery I wanted to have!

Meanwhile, I’m searching for a full-time job that provides health insurance while I’m feeling less than stellar because of my health problem. I’m seriously depressed because it feels like I’m giving up my dream of being self-employed and because even if I find a job I’ll still have to bust my butt evenings and weekends to keep my business going (and pay the business bills). I looked into the healthcare sharing programs, but they didn’t help me because you still have to pay for all expenses. So I would still have to pay $20,000 for surgery, but I could submit any amount over $300 to receive help for from other members.

Hold your horses! I have my own business so can’t I get health insurance through my business? I asked my accountant and he recommended finding a Dave Ramsey Endorsed Local Provider (ELP) for insurance (by the way, the Dave Ramsey website is how I found my stellar accountant). So I called the only ELP for insurance in Houston and told him about my healthcare dilemma. He said that I could get a health insurance plan through my business if I had two employees on the payroll. So I hired my hubby to do the IT for my business.

I hope to have my new PPO health insurance plan in about 3 months. I’m hopeful we will get better health insurance so that we’ll have more money available for saving for our children’s college education and saving for our own retirement. I’m angry that our health insurance system is so broken that it’s costing my middle income family more to get health insurance than it does to keep a roof over our heads.

UPDATE:  We got quotes for getting health insurance through my business.  It was expensive and the coverage was lousy – it felt like paying to NOT have health insurance. The solution? I found a full-time job working remotely and got excellent health insurance. Actually, the health insurance through my new employer was so good it was the best we’d ever had! Everything was a copay, so it was affordable to go to the doctor, and affordable for the surgery I needed. Instead of paying a percentage of the surgery’s cost (which would have been thousands of dollars out of my pocket), I paid a $100 copay for the hospital stay.

So, the lesson that my family learned is that we must have an employer in order to get good health insurance. It’s sad but true that entrepreneurs have a challenging time finding good health insurance. And we had to learn that the hard way through first-hand experience.

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I hope that you learn something from my experience and I’d love to learn more from you!