Find an affordable short-term health plan that’s right for you.
With employer-sponsored health insurance, your employer makes most of the decisions and presents you with one or more options; it’s convenient and usually cheaper than individual health insurance depending on what your employer contributes toward the premiums.
As you strike out on your new path, you’ll have an opportunity to choose your insurance company, plan design and level of coverage. And because it’s not tied to an employer, you can keep the insurance for as long as you want.
How do you do that? Simple, either go through HealthCare.gov Opens in new window, purchase directly from an insurer or buy from a licensed broker.
What is individual health insurance?
Individual health insurance plans can be tailored to fit your needs and the needs of your family. In addition to picking the plan that works best for you, you can add individual dental insurance and individual disability insurance.
How to buy individual health insurance
As with employer-based coverage you have a limited window, called open enrollment, when you can buy individual health insurance. There are some cases, though, in which you can enroll outside of this window—one of them being loss of employer coverage. That means if you have retired or left your job to start your own business, you are eligible to enroll anytime. Otherwise, you need to wait until open enrollment. The 2021 open enrollment period runs from Nov. 1 to Dec. 15, 2021 for coverage that starts Jan. 1, 2022 (you have until Jan. 15 to sign up for 2022 coverage that starts when you enroll), though a few states extend the deadline through January 2022.
What plans are available in your state?
To start, find out what plans are available in your area. Not every health plan serves every state and often, the options even vary by ZIP code. You can learn which plans serve your area by talking to a licensed broker or by using the HealthCare.gov Plan Finder Opens in new window .
Before signing up for a plan, though, you will want to see if you’re eligible for a premium tax credit through the ACA. This credit reduces the costs of premiums purchased through the ACA Marketplace. To be eligible, your income must be between 100% and 400% of the federal poverty level Opens in new window: That is a maximum of $51,520 for an individual, $69,680 for a couple and $106,000 for a family of four.
Health insurance, credits, subsidies and the ACA
When you apply for coverage through the health insurance exchange and provide your income information, you will learn whether you are eligible for a subsidy. You do not have to apply to find out the amount you are eligible for: Just use the HealthCare.gov calculator.
The subsidy is in the form of a tax credit. You can opt to receive it in advance and lower your premium payments, claim it later when you file your tax return or some combination of the two. Keep in mind that you will have to repay the difference if your 2021 income exceeds the threshold.
Elizabeth left her job to start a consulting business. She applied through the ACA Health Insurance Marketplace for 2021 coverage and, based on her estimated 2021 income, discovered she is eligible for a $400 monthly subsidy. But her new business ends up having a stellar first year, and her 2022 income ends up being well over $70,000. She’ll have to repay the credit when she pays her 2022 income tax.
Ian is opening a bakery. Based on his 2021 income, he didn’t qualify for the credit. Because 2022 ends up being a building year, he takes home only about $30,000. He’s still eligible for the credit, which will be applied to his 2022 income taxes.