Did You Lose Your Job and Health Coverage? You’ve Got Options.

Article Written by: Alice Stevens | Best Company Editorial Team  

Record numbers of people have filed for unemployment due to COVID-19-related closures. If you’re one of these people, know you’re not alone.

If you lost your health insurance coverage when you were laid off, know you have options for getting the coverage you need.

If you didn’t have health insurance through your job and want to have coverage just in case, you also have options for getting insurance.

I’ll review your options for both cases and review how recent legislation has affected health care coverage:

I had insurance through my former employer.

Because you lost your health coverage when you lost your job, you qualify for a special enrollment period. This allows you to enroll in a health insurance plan even though it may not be open enrollment. Special enrollment periods end 60 days after the qualifying event. You can choose to extend your former employer’s coverage through COBRA, buy private health insurance, or buy an Affordable Care Act plan through the health insurance marketplace.

If these plans aren’t a good fit, you can explore alternatives. These options include short term health insurance, health insurance ministries, and government-funded plans. To learn more about these, jump ahead to “I did not have health insurance through my former employer.”

For more on Special Enrollment Periods, read “[Infographic] 5 Questions to Ask About Special Enrollment Periods”.

COBRA

COBRA stands for the Consolidated Omnibus Budget Reconciliation Act. It allows you to continue your employer-sponsored coverage for 18–36 months. To be eligible for COBRA the following must apply:

  • Your former employer must have had at least 20 employees for more than half of its business days last year.
  • You were terminated, but not for gross misconduct. Or, your hours were reduced.

If you’re a dependent of someone who lost their job or now has reduced hours, you also qualify for COBRA. Dependents are also eligible for COBRA if the employee becomes eligible for Medicare, in situations of divorce or legal separation, and if the employee passes away.

If you choose to enroll in COBRA, you’ll take full financial responsibility for participating in the health plan. The employer contributions will become your responsibility.

“If someone loses their job because of COVID-19, they should first figure out when their health insurance will run out and what COBRA will cost them. COBRA is typically prohibitively expensive, but may be worthwhile if you have special or extensive health care needs or existing health care relationships you need flexibility to maintain,” Deborah GordonThe Health Care Consumer’s Manifesto author.

Your former employer is legally obligated to provide you information on COBRA and enrollment. You typically have 60 days from when you receive the election notice or lose coverage, whichever is later to decide whether to enroll in COBRA. COBRA can also be retroactive, so if you do not enroll and need medical care within the 60-day election period, you can enroll, pay past premiums, and have coverage.

You can enroll yourself or your dependents separately in COBRA. Each eligible person must make an election to be covered through COBRA.

For more information on COBRA, read the Department of Labor’s helpful FAQ.

Private insurance

Insurers can offer plans that do not meet the Affordable Care Act guidelines. These plans are sometimes called off-exchange plans. Because they don’t have to cover everything Affordable Care Act plans do, you may be able to find a plan that offers the coverage you need at a lower price.

These off-exchange plans can have a lot of variability, so you need to carefully review what’s covered and what isn’t along with the premiums and out-of-pocket costs. Working with an independent insurance agent can help ensure that you find a plan that meets your needs.

Affordable Care Act plans

If you visit HealthCare.gov, you can view the Affordable Care Act plans available in your area. Depending on your financial circumstances, you may be able to qualify for a subsidy on monthly premiums.

Affordable Care Act plans do not have exclusions for pre-existing conditions and provide comprehensive coverage for health care services.

If you’re in good health and are under 30, you may be able to opt for a catastrophic plan. These plans have low premiums and high deductibles. These plans are designed for people who don’t have medical concerns and mainly need coverage for emergency situations.

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Eric Wilson
Eric Wilson
Eric has been serving clients throughout the country since 2004. He Specializes in Individual Health, Group Health, and Medicare, and planning a tax-free retirement. He is also an expert on the Affordable Act. I am passionate about what I do, and it shows in my work and proven track record. Want to learn more? Follow me on my social channels, or contact me directly - I’d love to hear from you!

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