Health Insurance · Insurance

Health Insurance for startups

Matthew Cordasco Co-founder and Head of Product

April 9th, 2013

Does anyone have creative ideas or resources in terms of getting health insurance if we are the founders of a pre-funding, pre-salary company?  

Several of us are currently under our spouses but that will not always be an option.  We looked into COBRA but that is prohibitively expensive.  Most PSO's want at least 3-5 salaried employees before they will accept us.  

This leaves a dangerous gap between starting a company and getting to decent funding before picking up health insurance.  

Thoughts or advice?

Jonathan Murray Co-Founder / CEO of MyVR.com

April 9th, 2013

We went ehealth.com in both of my startups to get benefits before we were large enough to have group benefits.  We went with something with a higher deductible to keep the costs down.  It's cheaper than Cobra, but health insurance is very expensive no matter how you look at it.  When we got funding in my first startup, we actually stuck with this option and just gave people a monthly health stipend, but told them it would go away when we got benefits.

When you're ready, fyi we use Bay Benefits for my current startup and I love them.

You might also want to check out www.Zenefits.com and see if they can do anything for you.  They're a new YC company tackling the problem of affordable benefits for startups.  

Michael Green Partner Technology Manager at Google

April 9th, 2013

If you are in decent health, a good option would be:

1:   Search for individual high deductible insurance via a site like ehealthinsurance.com or others mentioned above.  I was able to cover a family of four for around $400 per month.  Keep in mind that these plans are essentially coverage for a disaster.  You will (hopefully) never get a penny of benefit.

2.  If you go the high deductible route, definitely set up an Health Savings Account, that could allow you to use tax free dollars to cover medical expenses.  You are allowed to even make a one time transfer of 5k? from an IRA without penalty.  If you are technically unemployed, you may be eligible to pay your health care premiums from this.  Note:  I'm not a CPA so please verify all of this with a professional.

3.   (before you get the flu) Find a doctor at a small or individual practice who doesn't take insurance (or isn't signed up as a provider with your insurance company).  Many would be happy to give you a clear discount price for an appointment  as a patient paying with cash.   Google "Ideal medical practice" to find some great docs who are likely solo practitioners (and entrepreneurs in their own right).

4.  Wait patiently until the Obamacare medical exchanges are established to see if you can get better coverage through that channel.

AJAY BAM Ceo and Co-founder at Vyrill Inc

April 9th, 2013

Matthew,

I am in a similar position as yours and I leverage Healthy San Francisco. It covers medical costs as long as you are in the San Francisco city area.  Its $450 for 3 months.  No dental/eye though which is fine with me. I buy separate health travel insurance as needed for international/domestic travel.

This is better than nothing at all.  I have been with the program for a year now.  I am in the healthy age group and fit and thus this is good enough for me.

http://www.healthysanfrancisco.org/


Craig Green

April 9th, 2013

We just bought person insurance for my wife and I thought Assurant -- a company that is affiliated with USAA. The premium is running $520/month, which is $800 cheaper than the COBRA offer I had. It's not bells and whistles, but it covers disasters nicely. C

Joel Magalnick Storyteller. Innovator. Leader.

April 9th, 2013

I haven't looked into it for a while, but Costco executive memberships used to have health plans available. Or, if there's a trade organization in your area that represents whatever kind of business you have, they may have a group plan you could join.

Ajay Kori Co-Founder at UrbanStems

April 9th, 2013

Along those same lines, I've found www.healthcompare.com to have some really reasonable plans, at least for the DC area.

Matt Moore Co-Founder & iCEO at CrowdMob Inc.

April 9th, 2013

You can always get personal health insurance directly from blue shield and blue cross. Def not cheap, but better than none Best, Matt -- Matthew Moore Co-Founder & CTO, CrowdMob Inc. Mobile: (650) 888-5962 Sent from my iPhone

Craig Green

April 9th, 2013

We looked at the NASE, And it was not as good a deal. Craig Green 703-864-3502

Chetan Nadgouda

April 9th, 2013

I looked into small business insurance through Costco. http://www.costco.com/business-health-insurance.html It is kind of expensive and hence we did not end up buying it. However, that’s an option.

Kevin Adler

April 9th, 2013

If you are based in SF, there are free health clinics and options of that sort. http://www.sffc.org/ http://www.healthysanfrancisco.org/ http://clinicbythebay.org/ wonderful amenities, which I hope will gain your donations when you exit / go public.