The short answer
If you run a one-person LLC or work as a sole proprietor, you don't have an employer plan, so you buy health insurance as an individual — typically through the ACA Marketplace. The upside is that you may qualify for premium subsidies based on your income, and you can often deduct your premiums as a self-employed person. So solo business owners have solid, affordable options even without a group plan.
The route is essentially the same as any individual buyer, with the added benefit of the self-employed deduction.
Your coverage options
The main option is an individual Marketplace plan, where subsidies can significantly lower your cost if your income qualifies. You could also buy an off-exchange individual plan (no subsidies), but most solo owners do best on the Marketplace. Our guide to health insurance for gig and 1099 workers context aside, our self-employed coverage overview covers the landscape.
A single-member LLC is generally taxed like a sole proprietorship, so your health insurance is handled on your personal return, not through a group plan.
The self-employed deduction
As a self-employed person, you can often deduct your health insurance premiums, which lowers your taxable income. This deduction interacts with any Marketplace subsidy, so the two are calculated together. Estimating your income carefully matters both for the subsidy and the deduction — our guide to how subsidies work covers the income side.
The bottom line: a solo LLC owner buys individual coverage, often with a subsidy, and can usually deduct the premiums — a combination that makes coverage more affordable than the sticker price.
Frequently Asked Questions
How does a one-person LLC owner get health insurance?
As an individual, typically through the ACA Marketplace, where you may qualify for subsidies based on income. A single-member LLC is generally taxed like a sole proprietorship, so coverage is handled on your personal return.
Can a sole proprietor deduct health insurance premiums?
Often yes. Self-employed people can usually deduct their health insurance premiums, lowering taxable income. This deduction is calculated together with any Marketplace subsidy.
Should a solo LLC buy on or off the Marketplace?
Usually on the Marketplace, since that's where subsidies are available. Off-exchange plans are an option if your income is too high for a subsidy.
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