Health Insurance for Home-Based Business Owners

Obtaining affordable health insurance today is a nationwide crisis, especially for the self-employed. Costs have spiraled out of control to the point where you may be thinking you may have to do without. Fortunately, that's not the case. The upside is you have both the luxury and the burden of having many choices.

Getting into a group plan is probably your best bet. Groups can often negotiate better coverage at a lower price for their members than you could as an individual. If you're willing to do some research, you should be able to uncover some options that will work for you. Here are five types of groups that often offer health insurance to their members:

Trade and professional associations that you're eligible to join. If you're not already a member of your industry's trade organization, sign up to join -- it's often free -- and find out what they have to offer.

Local chambers of commerce. Call your city's chamber of commerce to determine if they've set up any arrangements for their member businesses.

College alumni associations or labor unions. Check at the alumni office of both your local community college and any university you or your spouse may have attended.

Business organizations like the National Federation of Independent Businesses. You can search the Web for other, similar groups using the term "small business advocacy group."

Regional or state organizations like Support Services Alliance and Working Today's Portable Benefits Network, both in New York state. To determine if you have a comparable organization in your area, contact the nearest Small Business Development Center or state local agency serving small business.

But don't stop your research there. Depending on your circumstances, group policies aren't always a better buy, both in their dollar cost and the benefits they provide. In addition, under an association umbrella some group plans are being used by the unscrupulous to sell such poor quality insurance that they're being investigated by state regulatory agencies.

To find out what coverage you can get from other sources, check out your individual options through an insurance agent who specializes in health coverage or through Web sites that provide price comparisons for individual policies and then link you to the companies or agents that sell them. Here's a list of some such sites:

AccuQuote, [phone]

Answer Financial, [phone]

BestQuote, [phone]

eHealthInsurance, [phone])

e-Insure Services, [phone]

InsWeb

QuickQuote, [phone]

Insure.com, [phone]

When working with an agent, you'll have a choice of:

Fee-for-service and indemnity health care plans, where you decide which doctor you want to see, schedule your own appointments, get diagnosed and treated, make your payment directly to the doctor on the way out the door, and submit a claim for reimbursement.

Health maintenance organizations, or HMOs, where you agree to have all your health care needs taken care of by the HMO and its administrators and physicians.

Preferred provider organizations, or PPOs, which are something of a hybrid between the policies of fee-for-service plans and HMOs because you can choose your own doctor -- even someone outside the system. However, you'll get better rates from physicians within the organization.

Health Savings Accounts, or HSAs, offer policies covering catastrophic illness. This option is usually best for single, healthy individuals.

Some states like California, Colorado, Connecticut, Maryland and Texas provide guaranteed issue of policies for small businesses and/or allow you to form your own insurance pools. Again, you can contact your state local agency serving small business to find out more about this option.