The Codex

Health insurance for freelancers: US options, tax credits, and coverage in the UK, Canada, and Australia

Compare a spouse's plan, Marketplace coverage, COBRA, and HSAs, estimate freelance income for tax credits, and protect your income if you can't work.

Most US freelancers get health insurance in one of four ways: a spouse's or partner's employer plan, an ACA Marketplace plan (with a premium tax credit if your income qualifies), COBRA for a bridge after leaving a job, or Medicaid at lower incomes. In the UK, Canada, and Australia, public systems cover core medical care for residents, so the decisions are mostly about extras and protecting your income when you can't work.

For 2027 coverage, the key US change is that the enhanced premium tax credits are gone, so the subsidy cliff at 400% of the federal poverty level is back. Your income estimate for the application now matters more than it has in years.

This guide walks through each option, the 2026 HSA change for bronze plans, the self-employed health insurance deduction, and disability cover, with short sections for the UK, Canada, and Australia.

Codex summary

US freelancers usually choose between a spouse's employer plan, an ACA Marketplace plan, COBRA as a bridge, or Medicaid. For 2027 coverage the enhanced tax credits are gone, so estimate net income carefully, especially near 400% of the poverty level. In the UK, Canada, and Australia public systems cover core care, so focus on extras and income protection.

Who this is for

Freelancers and people about to leave a job who need to choose health coverage, estimate income for a Marketplace application, or decide whether private health or income protection insurance is worth it.

If you only do 3 things

Before your last day at a job, line up coverage inside the 60-day Special Enrollment Period instead of letting it lapse.
Estimate next year's net household income, not gross invoices, and update your Marketplace application when it changes.
Price disability or income protection cover alongside health insurance, and match the waiting period to your emergency fund.

Disclaimer: This is general information for freelancers, checked on November 4, 2026. It is not insurance, tax, or legal advice. Plan prices and rules vary by state, province, and personal situation. Confirm your options on your official marketplace or government site, and talk to a licensed broker, a certified enrollment assister, or a tax professional before you decide.

US health insurance options for freelancers at a glance

If you work for yourself with no employees, you buy coverage as an individual, not as a small business. HealthCare.gov treats you as self-employed and points you to the individual Marketplace. ^[10]

Spouse's or partner's employer plan

Often the best value when the employer pays part of the family premium. If the plan offers family coverage, you usually can't also get Marketplace tax credits. ^[10]

ACA Marketplace plan

Available to anyone without other qualifying coverage during Open Enrollment or a Special Enrollment Period. Premium tax credits depend on expected income. ^[1]

COBRA

Keeps your old employer plan for a limited time, usually up to 18 months, but you can be charged up to 102% of the full cost. ^[3] ^[4]

Medicaid

Free or low-cost coverage for lower incomes. Rules vary by state, and the Marketplace application checks eligibility for you.

Whichever you choose, budget for it the way you budget for taxes. Your premium is a fixed cost of doing business, so build it into your floor rate with the freelance rate calculator before you quote your next project.

Leaving a job: your 60-day window and COBRA

Losing job-based coverage, including when you quit to freelance, usually opens a Special Enrollment Period. You can qualify if you lost coverage in the past 60 days or expect to lose it in the next 60 days, so you can line up a plan before your last day. ^[2]

COBRA lets you keep the same employer plan, the same doctors, and any deductible you've already met. It generally applies to employers with 20 or more employees, usually lasts up to 18 months, and you have 60 days to elect it. ^[3] ^[4] The catch is price: you pay the whole premium, including the share your employer used to cover, plus up to 2% for administration.

Hypothetical example. Your employer plan costs $750 a month in total, and you paid $150 of it through payroll. On COBRA you could pay up to $750 × 1.02 = $765 a month, more than five times what you paid as an employee.

The timing rules matter if you start on COBRA and want to switch:

During Open Enrollment, you can move to a Marketplace plan whatever your reason for ending COBRA. ^[5]
Outside Open Enrollment, ending COBRA early by choice, or simply stopping payments, does not open a Special Enrollment Period. You would usually wait for the next Open Enrollment. ^[2] ^[5]
When COBRA runs out, you get a new 60-day window to enroll in a Marketplace plan. ^[2]

If you're still planning the move, the leaving your job to freelance roadmap covers the runway, first clients, and admin you'll want in place before that 60-day clock starts.

Premium tax credits for 2027 coverage

On HealthCare.gov, Open Enrollment for 2027 coverage runs from November 1, 2026 to January 15, 2027. Pick a plan by December 15 for coverage that starts January 1. States that run their own marketplace can set different dates. ^[1]

The enhanced premium tax credits expired at the end of 2025, and KFF notes their loss is still shaping 2027 prices and enrollment. ^[6] Three things follow for freelancers:

The 400% cliff is back. Households above 400% of the federal poverty level get no premium tax credit and pay the full premium. ^[6] 2027 savings are figured with the 2026 poverty levels: $15,960 for one person and $33,000 for a family of four (higher in Alaska and Hawaii). That puts the cliff at $63,840 for a single person and $132,000 for a family of four. ^[7]
Prices are higher. KFF reports the average benchmark silver premium rising 13% for 2027. ^[6]
Overestimating credits costs more. From the 2026 tax year, there is no cap on repaying excess advance credits when you file, so an optimistic income estimate can turn into a large tax bill. ^[8]

A few states add their own help. KFF lists New Mexico as continuing to fully replace the lost federal assistance in 2027, with partial state programs elsewhere. ^[6] For the dates, the credit changes, and reconciling on Form 8962 in one place, read the 2027 ACA Open Enrollment briefing for the self-employed.

Estimating freelance income for the application

The Marketplace asks for your expected household income for the coverage year, not last year's. For self-employment, use net income: what you expect to report as profit after business expenses, not your gross invoices. ^[9] The figure that counts is modified adjusted gross income (MAGI), which for most people is close to adjusted gross income.

Start from your year-to-date net profit and your current client list.
Adjust for clients you know are starting, ending, or changing scope next year.
Add a spouse's wages and any other taxable household income.
Subtract above-the-line items you expect, such as the deductible half of self-employment tax and planned retirement contributions.
Write down how you got the number, so you can update it quickly when things change.

Hypothetical example near the cliff. A single freelancer expects $68,000 of net profit in 2027 and no other income. Self-employment tax is roughly $68,000 × 92.35% × 15.3% = $9,608, and half of that ($4,804) is deductible. Before any retirement contribution or health insurance deduction, AGI is about $68,000 − $4,804 = $63,196.

That is only $644 under the $63,840 line. One extra invoice could push the household over 400% and wipe out the whole credit, which would then have to be repaid in full. A planned retirement contribution, or reporting the change to the Marketplace as soon as it happens, is the kind of move to discuss with a tax professional here.

If your income changes mid-year, update your application so the monthly credit tracks reality. For the tax side of the same numbers, the US federal tax return guide for 2026 returns and the tax set-aside calculator help you keep estimates and savings in step.

Joining a spouse's or partner's plan

If your spouse's employer plan covers spouses and dependents, it is often the simplest route. HealthCare.gov says that in most cases you then won't qualify for Marketplace tax credits. The exception is when the employer coverage is considered unaffordable or doesn't meet minimum standards. ^[10] The Marketplace application asks about the offer and works this out.

Two practical points. First, adding yourself usually needs a qualifying event, such as losing your own coverage, or your spouse's employer's open enrollment. Second, eligibility for a subsidized employer plan, including a spouse's, also blocks the self-employed health insurance deduction for those months, even if you don't enroll. ^[15]

HSA-eligible plans and the 2026 bronze change

A health savings account (HSA) lets you put money aside tax-free for medical costs, but only if you're covered by an HSA-compatible plan. The rule changed for 2026: as of January 1, 2026, bronze and catastrophic plans available through an exchange count as HSA-compatible, even if they don't meet the usual high-deductible plan definition, and they don't have to be bought through an exchange to qualify. ^[11] The same IRS guidance confirms telehealth before the deductible no longer breaks HSA eligibility and allows certain direct primary care arrangements.

The 2027 figures from IRS Revenue Procedure 2026-24: ^[12]

HSA contribution limit: $4,500 for self-only coverage, $9,000 for family coverage.
Other high-deductible health plans: minimum deductible of $1,750 self-only or $3,500 family, and out-of-pocket costs capped at $8,700 self-only or $17,400 family.

Hypothetical example. You choose a bronze plan for 2027 and put the full $4,500 self-only amount into an HSA. If your top federal income tax rate is 24%, that saves about $4,500 × 24% = $1,080 in federal income tax, and the deduction also lowers the MAGI used for your premium tax credit.

Catastrophic plans are mainly for people under 30, or people with a hardship or affordability exemption, and you can't use advance premium tax credits on them. ^[13] CMS has moved to widen the hardship exemption for people who lose credits because of their income, but KFF reports part of that expansion is paused by a court decision for this Open Enrollment, so check eligibility on your application. ^[6] ^[14]

The self-employed health insurance deduction

If you have a net profit from self-employment, you can usually deduct premiums for medical, dental, and vision coverage, and qualified long-term care insurance, for yourself, your spouse, and your dependents. ^[15] The rules that trip people up:

No deduction for any month you were eligible for a subsidized employer plan, including a spouse's, even if you didn't enroll.
It can't be more than the net profit from the business the plan is under.
It doesn't reduce self-employment tax, only income tax.
If you also get a premium tax credit, the deduction and the credit interact, and IRS Publication 974 explains the calculation.

Keep premium statements with your bookkeeping. The money, tax, and bookkeeping pillar shows how to file them so they're easy to find at tax time.

Disability and income protection insurance

Health insurance pays for treatment. Disability insurance (called income protection in the UK and Australia) replaces part of your income if illness or injury stops you working. For a freelancer with no sick pay, that second risk can be the bigger one.

When you compare private policies, these terms decide what you actually get:

Definition of disability. Own-occupation cover pays if you can't do your own job. Any-occupation cover pays only if you can't do any suitable job, which is much harder to claim.
Waiting (elimination) period. How long you wait before benefits start. A longer wait lowers the premium, so match it to your emergency fund.
Benefit period. How long payments last: a few years, or to a set age.
How income is proven. Freelance income moves, so ask how the insurer calculates it (tax returns, average of several years) before you buy.

In the US, Social Security Disability Insurance is a backstop, not a replacement. You need work credits: in 2026 you earn one credit for each $1,890 of wages or net self-employment earnings, up to four a year, and self-employment counts once you pay self-employment tax. ^[16] If a disability starts at 31 or older, you generally need 20 credits in the 10 years before it began. ^[17] Underreporting income to save tax can also shrink this protection.

If you're already running close to empty, the freelancer burnout and boundaries guide is the prevention side of the same problem.

United Kingdom

NHS services are free at the point of use for people who are ordinarily resident, except where charges are expressly allowed by law. ^[18] Being self-employed doesn't change that.

Private medical insurance is optional. Freelancers buy it mainly for faster access to treatment or a choice of hospital, not because the NHS won't treat them.
Income is the real gap. Statutory Sick Pay requires you to be classed as an employee. ^[19] New Style Employment and Support Allowance is open to people who have been self-employed, if you've paid enough National Insurance contributions, usually in the last 2 to 3 years. ^[20]
Income protection insurance is optional. It is private cover that pays a monthly benefit if you can't work. Use the disability terms above to compare policies.

Canada

Each province and territory runs its own public health insurance plan, and you register with the one where you live. Canada.ca warns that some provinces have a waiting period of up to three months before public coverage starts, and recommends private insurance to cover it. ^[21] That matters if you're moving from abroad to freelance.

Supplementary or extended health insurance. Employees often get drugs, dental, vision, and paramedical care through a work plan. As a freelancer you can buy individual extended health cover, or join a group plan through an association. What each province pays for beyond doctors and hospitals varies.
EI special benefits are opt-in. Self-employed people can register for EI special benefits, including sickness benefits of up to 26 weeks. Your agreement must be active for 12 months before you can claim, and for claims in 2026 you need at least $9,254 of net self-employed earnings in 2025. The benefit is up to 55% of earnings, to a maximum of $729 a week in 2026. ^[22]

Australia

Medicare covers public hospital treatment as a public patient and subsidizes GP and specialist visits. It doesn't cover ambulance services, most dental, glasses, or hearing aids. ^[23] Private health insurance is optional, but two tax rules push higher-earning freelancers to look at hospital cover:

Medicare levy surcharge (MLS). If you don't hold an appropriate level of private patient hospital cover and your income for MLS purposes is above the threshold, you pay an extra 1% to 1.5%.
Lifetime Health Cover loading. If you take out hospital cover after the 1 July following your 31st birthday, you pay 2% extra on the premium for every year you're over 30, up to 70%. The loading stops after 10 years of continuous cover. ^[25]

MLS thresholds for 2026–27: singles

$105,000 or less: 0%
$105,001 to $123,000: 1%
$123,001 to $164,000: 1.25%
$164,001 or more: 1.5%

MLS thresholds for 2026–27: families

$210,000 or less: 0%
$210,001 to $246,000: 1%
$246,001 to $328,000: 1.25%
$328,001 or more: 1.5%

Family thresholds rise by $1,500 for each dependent child after the first. ^[24]

Hypothetical example. A single freelancer has $130,000 of income for MLS purposes in 2026–27 and no private hospital cover. That falls in the 1.25% tier, so the surcharge is $130,000 × 1.25% = $1,625 on top of the regular Medicare levy. Compare that with the yearly cost of a basic hospital policy that qualifies.

A decision checklist

List every option you can actually get: a partner's plan, COBRA, the Marketplace, Medicaid, or your country's public system.
Note your deadlines: the 60-day window after job coverage ends, or the Open Enrollment dates.
Estimate next year's net household income, and check how close it is to the 400% line.
Compare total yearly cost: 12 months of premiums plus the deductible and out-of-pocket maximum.
Check that your doctors and prescriptions are covered by the plans you're comparing.
If you pick a bronze plan, decide how much to put into an HSA.
Price disability or income protection cover, and match the waiting period to your emergency fund.
Put a reminder in your calendar to update your income estimate every quarter.

Common mistakes

Using gross invoices as income. The application wants expected net profit, not revenue.
Letting job coverage lapse without a plan. Miss the 60-day window and you may wait months for Open Enrollment.
Dropping COBRA mid-year to save money. Ending it by choice doesn't open a Special Enrollment Period.
Comparing premiums only. A low premium with a high deductible can cost more in a bad year.
Claiming the deduction in months you could join a spouse's subsidized plan. Those months don't qualify.
Insuring treatment but not income. For many freelancers, months without earnings hurt more than the medical bill.

FAQ

What is the cheapest way for a freelancer to get health insurance in the US?

There is no single cheapest option. Compare a spouse's or partner's employer plan, Marketplace plans with any premium tax credit you qualify for, and Medicaid if your income is low enough. Compare total yearly cost (premiums plus the deductible and out-of-pocket maximum), not just the monthly premium.

Can I get Marketplace coverage right after I quit my job to freelance?

Usually, yes. Losing job-based coverage generally opens a 60-day Special Enrollment Period, and you can apply up to 60 days before the coverage ends. Voluntarily dropping coverage, or choosing to stop paying COBRA premiums, doesn't qualify on its own.

Are premium tax credits still available for 2027 coverage?

Yes, but only the original version. The enhanced credits expired at the end of 2025, so for 2027 coverage households above 400% of the federal poverty level get no credit. For a single person that line is $63,840, and for a family of four it is $132,000 (higher in Alaska and Hawaii).

Can I open an HSA with a Marketplace bronze plan?

From January 1, 2026, bronze and catastrophic plans are treated as HSA-compatible, including ones bought outside an exchange. For 2027 you can contribute up to $4,500 with self-only coverage or $9,000 with family coverage, if you meet the other HSA rules.

Do self-employed people in the UK, Canada, or Australia need private health insurance?

Usually not for core medical care, which public systems cover for residents. The bigger gap for freelancers is income when you can't work, because UK Statutory Sick Pay is for employees and Canadian EI sickness benefits require opting in. In Australia, higher earners without private hospital cover can pay the Medicare levy surcharge.

Sources

Primary sources referenced above (checked November 4, 2026)

Tools and templates

Freelance Rate Calculator

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Status

Last reviewed: Nov 04, 2026

Change log

Nov 04, 2026: Published a guide to health coverage for freelancers: US Marketplace plans and 2027 premium tax credits, the 60-day window after leaving a job, COBRA, a spouse's plan, HSA-eligible bronze plans, the self-employed health insurance deduction, disability cover, and notes for the UK, Canada, and Australia.