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5 min read

    5 min read

    I’ve always had health insurance through my day job but I know a lot of you out there might have questions about getting coverage on your own.  Today, I have a guest post from Tristan Zier, founder of Zen99, a company that specializes in providing health insurance and tax information for rideshare drivers.

    Normally, I don’t accept guest posts from companies but since Tristan is a fellow UC San Diego alumnus 🙂 and this is a topic I don’t know much about, I figured we’d give it a shot.  Please let me know if you find articles like this valuable and I’ll see if I can get some more posts from industry experts.  FYI, I have no financial relationship with Zen99.

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    As an independent contractor, you are not eligible for benefits through the companies you work with – including health insurance.

    But don’t worry; there are plenty of benefits to getting your own individual plan! We’ll go over the basics plus some of the ways it may actually benefit you.

    1.  What’s the Affordable Care Act, and how does it affect 1099 workers?

    The ACA (aka “Obamacare”) was a massive overhaul of the US healthcare system, with the biggest changes going into effect in 2014. The primary goals were to increase the quality and affordability of healthcare and make it easier for individuals (including contractors) to purchase insurance.

    California drivers: Want to see a doctor but don’t want high doctor office prices? Get advice and prescriptions from a doctor on Remedy’s app for only $30. Message a personal doctor without leaving your home or car and get treatment for most common conditions. Prescriptions sent to your nearest pharmacy. For more information, visit Remedy here.

    2.  How does ACA help decrease my monthly health insurance cost?

    Starting with 2014 plans, you may be eligible for a tax credit or subsidy if you make up to 400% of the Federal Poverty Line (FPL). Depending on your income, you could pay as little as $20/month for health coverage.

    The FPL amounts change every year, but shouldn’t change much from the ones for 2014 health coverage. For example, you could receive subsidized insurance if your income is below $45,960 (for a household of 1) or $94,200 (for a household of 4). {Editor’s Note: sounds like a lot of drivers will qualify}

    (Zen99 will help you find out if you qualify for a tax subsidy – sign up for free here then head to ‘Insurance’!)

    3.  Does it matter where I buy my health insurance plan from?

    Monthly premiums might vary between insurers (e.g. Blue Cross vs United) or types of plans (e.g. a Gold plan vs a Bronze plan).

    However, for a certain plan (e.g. a Bronze plan from Blue Cross), your monthly premium is legally required to be the same whether you buy a plan through Healthcare.gov, a broker like Zen99, or direct from the insurer. The only thing that changes is where the insurance company pays the commission for finding that new customer.

    4.  When can I enroll in an individual plan?

    You can enroll in an individual health plan during Open Enrollment or Special Enrollment.

    • Open Enrollment is the period each year when insurers offer health insurance plans to any individuals who would like to purchase them. Open Enrollment for 2015 coverage is from November 15, 2014 to February 15, 2015.
    • If it is outside of the Open Enrollment period, you can only enroll in a normal health plan if you qualify for Special Enrollment. Special Enrollment is a 60 day period you are given when you have a “Qualifying Event” (certain government-defined life events, such as a job change).
    • Learn more about these two periods

    5.  What do premium, deductible, copay, and coinsurance mean?

    A premium is the amount you pay for your health insurance, typically paid monthly. A deductible is the amount you pay for medical bills before your health insurance starts to help (a higher deductible typically means a lower monthly premium). A copay is a fixed dollar amount you pay for certain services, such as visiting a doctor. Coinsurance is a percentage of the cost that you pay for covered services, up until you reach your out-of- pocket maximum (the amount after which insurance pays 100% of your covered service medical bills).

    6.  Should I get a PPO or HMO?  What about a Bronze/Silver/Gold/Platinum plan?

    HMOs and PPOs are the two primary types of insurance plans. HMOs are slightly cheaper, but severely restrict which doctors or hospitals you can go to. PPOs offer much more choices (they prefer you see “in-network” doctors they work with, but will also discount “out-of- network” visits).

    Bronze / Silver / Gold / Platinum refers to the four levels of health plans that all insurers must now provide. They differ from each other based on how much of your expenses will be covered on average (60% for Bronze, 70% for Silver, 80% for Gold, 90% for Platinum).

    7.  Can I write off health insurance premiums as a business expense?

    You may be able to. This reduces your taxable income, and can save you tons of money on taxes. There are two main requirements:

    1. Your business must make a profit
    2. You or your spouse can’t be eligible for an employer-subsidized plan

    There are a few other things you should know if you want to do this – learn about them in this blog post on health insurance tax deductions.

    8.  What if I don’t end up getting health insurance?

    There are two reasons this isn’t a good idea:

    1. You need to ensure you are protected in case of an emergency! Even a leg break can cost you upwards of $50,000 in medical bills – which can force you into bankruptcy if you don’t have the proper insurance.
    2. Soon, you’ll have to pay 2.5% of your income as a fine if you don’t have the minimum essential coverage.

    In addition to helping you find health insurance plans, Zen99 can help you with 1099 taxes. Our tax tracking platform connects with your bank accounts to easily track earnings and expenses, plus helps you file your required quarterly taxes. Click here to sign up for free!

    Tristan Zier is the co-founder and CEO of Zen99, a company that helps rideshare drivers with tax and insurance tools to get organized and stay covered. Prior to founding Zen99, Tristan was Director of Operations at Exec (acquired by Handy) and a CPA with Deloitte. Follow them on Twitter @Zen99.

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    Disclaimer: Content is meant only as a guide; please hire a tax/legal professional if you are in need of professional advice.

    Harry Campbell

    Harry Campbell

    I'm Harry, the owner and founder of The Rideshare Guy Blog and Podcast. I used to be a full-time engineer but now I'm a rideshare blogger! I write about my experience driving for Uber, Lyft, and other services and my goal is to help drivers earn more money by working smarter, not harder.

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