If you’re self-employed in Virginia—whether you run a solo LLC or have multiple members—you don’t get health insurance handed to you by an employer. You have to figure it out yourself.
The good news: Virginia’s health insurance market has real options, and if you know where to look, you can find solid coverage that fits your health needs and your budget.
This guide walks you through the main paths: ACA marketplace plans (with subsidies if you qualify), private plans outside the marketplace, and group options if you have employees. We’ll help you understand the trade-offs so you can pick based on what actually matters for your business and your health.
How the IRS Sees Your LLC
For tax and insurance purposes, LLC owners with no employees are self-employed.
Single-member LLCs are treated as sole proprietorships; multi-member LLCs as partnerships.
This classification affects your tax deductions—you can deduct 100% of health insurance premiums — and it determines which types of plans you can access.
Virginia Health Insurance Marketplace for Self-Employed
Virginia has embraced the ACA marketplace and maintains a state-based private insurance market.
Translation: you have more choices than most states, which means better rates and more plans competing for your business.
Small Group Health Plans (If You Have Employees)
If your LLC has employees, you can access small group health insurance — which typically offers better coverage and lower costs than individual marketplace plans. But there are trade-offs to understand.
The Minimum Requirement
Most small group plans in Virginia require a minimum of 2 or more employees to participate. This means you can’t offer group coverage as a solo LLC, but as soon as you have one non-owner employee (or a few, depending on the carrier), you’re in.
Two Funding Models: Know the Difference
Small group plans come in two flavors:
Fully Insured Plans — The insurance company bears all the risk. Your premiums are locked in each year, predictable, and you’re protected from catastrophic claims.
Best for: LLC owners who may have employees with health issues.
Level Funded Plans — A hybrid. Your LLC pays a fixed monthly premium like fully insured plans, and the insurer covers anything above that threshold with stop-loss protection.
Premiums are typically lower than fully insured, but you carry some responsibility — hence the built-in protection.
You group is also “rewarded” for staying healthy. If claims come in under budget you may be entitled to a refund.
Best for: LLC owners with healthier employees.
Benefits of Group Coverage
Better plan options and lower employee out-of-pocket costs than individual marketplace plans.
Attracts and retains quality employees — benefits matter for hiring.
You may qualify for the Small Business Health Care Tax Credit, which can cover up to 35% of premiums for qualifying employers. Always consult with your tax advisor.
Premiums are tax-deductible as a business expense.
How to Get Started
Work with a agency who specializes in small business health insurance in Virginia.
Generally, there is no additional fee for this service. Most brokers get a commission from the insurance company for educating and assisting customers.
They’ll assess your eligibility, model fully insured vs. level funded for your situation, compare carrier options, and handle enrollment.
This is too complex to DIY — a good broker pays for itself by finding you better rates and terms.
Tax Deductions: The Big Advantage of Being Self-Employed
As an LLC owner, you can deduct 100% of your health insurance premiums as a business expense—if you’re not eligible for an employer plan (including a spouse’s plan).
This deduction covers medical, dental, and long-term care insurance for you, your spouse, and dependents. It’s taken “above the line,” which means it lowers your adjusted gross income and gives you tax savings whether you itemize or take the standard deduction.
Virginia follows federal tax treatment, so your deductions work on both federal and state returns. Just remember: your deduction can’t exceed your LLC’s net profit for the year.
Choosing the Right Plan for Your Situation
Start with your healthcare reality:
- What ongoing medical conditions do you have?
- What medications do you take? (Check formularies early—this is often where plans differ most.)
- Who are your preferred doctors and specialists?
Then compare on premiums and out-of-pocket costs. A cheap plan with a $6,000 deductible isn’t a bargain if you know you’ll hit it every year.
If you have employees, loop their needs into the decision. SHOP group coverage often provides better value than individual marketplace plans, and it signals to talent that you take benefits seriously.
If You’re Managing Diabetes or Another Chronic Condition
If you have diabetes or any chronic disease that requires ongoing specialist care, generic plan comparisons fall short. You need coverage that actually supports your treatment.
Three things to verify before you enroll:
- Your medications are covered at an affordable tier. Diabetes medications (especially GLP-1 drugs like Ozempic and Mounjaro) can cost $100–$200/month on Tier 4. Check the plan’s formulary before you sign up—don’t find out after you’ve committed.
- Your endocrinologist or specialist is in-network. Cheap plans often exclude specialists or make them out-of-network. Call the plan and confirm your specialist’s in-network status. Prior auth requirements matter too—some plans require approval for every specialist visit.
- Durable medical equipment and monitoring supplies are covered. For diabetes, that means CGMs (Dexcom, Libre), test strips, lancets, and pumps. Formularies vary widely. Ask directly if you’re covered.
We’ve built a diabetes-specific insurance guide and state-by-state coverage matrix to help you decode what each plan actually covers—not just the marketing. Because managing a chronic condition shouldn’t mean fighting with your insurance company every month.
Explore our diabetes and health insurance resources to see exactly how plans stack up on the medications and equipment you need.
Ted McNeil — Owner, Broker, Founder, BenZen Insurance. We simplify benefits.
Educational content only — not legal, medical, or financial advice.