Founders and self-employed professionals do not have an employer plan to fall back on, so they have to choose coverage themselves. In New York, the rules and options are different from many other states, which makes it worth understanding the basics before comparing plans. I am a licensed New York insurance producer, but this is general information and rules change, so confirm the details for your situation.
The state marketplace
New York State of Health is the official marketplace where individuals and families can compare plans and, if eligible, receive financial help with the cost. Plans are grouped into metal levels, and the level reflects how the cost of care is shared between you and the insurer. Some people with lower incomes may qualify for public programs instead. Enrollment normally happens during an annual open enrollment period, with special enrollment available after certain life events such as losing other coverage.
Coverage through your company
If your company has employees, you may be able to offer a group plan. Eligibility, rates and participation rules differ for small groups, and they differ again if the only people covered are owners. A broker can check what is available for your company's structure and size.
What to compare
Do not choose on premium alone. Compare the deductible, the out-of-pocket maximum, the copays, the network and the prescription drug coverage. Check that your doctors and hospital are in the network, because an out-of-network visit can cost far more. If you travel or live in more than one place, ask how the plan covers care away from home.
Health savings accounts
Certain high-deductible plans can be paired with a health savings account, which lets you set aside pre-tax money for medical costs under federal rules. This can be attractive for healthy, higher-income founders, but it only makes sense if you can afford the deductible. Ask your tax adviser about the rules and the annual limits.
Protect your income too
Health coverage pays medical bills, not your living expenses. A founder whose income stops after an illness may also want to look at disability insurance, which is a separate product. If others depend on your income, life insurance belongs in the same conversation.
This article is general information, not legal, tax, investment or insurance advice. Speak with your own advisers about your situation.
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