1. Do not try to your change insurance plan if you have a serious medical condition. Instead, contact your current insurer directly to ask about continuation of coverage options. Insurance services like Medsave.com are designed to provide insurance only for unknown future medical problems. These services do not help people with current medical problems. If you have medical conditions and absolutely must change health plans, switch to an HMO (these are not handled by Medsave.com)..

2. Think short term. Most people who buy their own health insurance change their coverage in less than a year. Buy plan that offers you best deal now without concern for whether it will be available in a year. Next year an entirely new generation of health plans will be available. A plan that you bought more than a year ago would not likely represent best value for you today. Use short-term medical insurance plans, student medical plans or foreign travel insurance plans if you qualify. These offer better deals if you qualify.

3. Choose a higher deductible. By taking a $1000 deductible, you will save more than $1000 in premium payments over a year's time. This should be an easy decision from a mathematical viewpoint. Some young people can buy a high deductible insurance plan for less than $30 per month to cover any serious medical issues.

There are potentially serious consequences for making a mistake in this area. If IRS reclassifies a worker as an employee, employer may owe all of retroactive wage taxes immediately – even those not collected from worker! There may be additional interest and tax penalties. When a mistake is discovered in an employee benefit plan, plan administrator may refuse to convey benefits to a worker who is not eligible for benefit. This could be disastrous in case of a business life insurance or health insurance plan. Since there are no absolute rules in this area of business management, it is always wise to consult with your own financial and tax adviser.

The rules used to determine status for wage tax purposes do not apply for eligibility in employee benefit plans. It is possible to be considered eligible for an employee benefit plan but actually be treated as a contractor for wage tax purposes. The opposite is also true – you may not be eligible for employee benefits but still be considered an employee for tax purposes. Determining eligibility for employee benefits is actually much easier – this is stated clearly in written plan description for each individual employee benefit. Just be careful not to assume that classification for one issue has any effect on determination for another purpose.