Whether you lose your job because of the recent pandemic or because your employer is simply shaking things up with a merger (or downsize), the financial blow to you and your family can be huge. It’s not just the loss of income and need to find another job; you might also lose valuable benefits such as health care coverage. Here are five options for quickly to get health insurance if you find yourself without your employer-sponsored benefits because of a job loss.
1. Opt for COBRA
To get health insurance COBRA coverage is a way to seamlessly extend your employer-sponsored coverage for a while longer. It can help you bridge the gap between now and a time in the future when you have a new job and the benefits to go with it.
What is it? COBRA stands for the Consolidated Omnibus Budget Reconciliation Act. The major provision of this act ensures that employees have a right to continue with group benefits for a certain amount of time after they lose or leave their job.
If your employer is covered under COBRA, it must offer some option for extending your health coverage. You can make a decision about electing COBRA in the 60 days following the qualifying event (the job loss).
Pros? The coverage must be the same as what active employees are receiving, and you can extend coverage for 18 or 36 months, depending on circumstances. That gives you more than a year to find a new job with benefits or make other arrangements for coverage.
Cons? The biggest disadvantage for COBRA is typically cost. When you’re employed, you and your employer both pay for the health insurance, which means you’re not covering the total costs of your premiums. Under COBRA, the group administrator can charge you up to 102% of the cost of the plan. That’s your part, the employer’s part and up to a 2% administrative fee.
How to get it? Talk to your human resources representative and ask about COBRA benefits if you’re being laid off or plan on leaving your job and have turned in your notice. Note that COBRA doesn’t apply to every company. Typically, it only applies if your employer has 20 employees or more or is a state or local government agency.
2. Get on a Family Member’s Plan
If COBRA is too expensive or isn’t available to you, you may be able to get on another family member’s existing employer-sponsored plan.
What is it? If your spouse or parent has health coverage through their employer, chances are there’s a family option. Since losing your coverage counts as a qualifying event, their employer may let them make a mid-year election to add you to their benefits. Under the law (as of 2020), you can get on a parent’s plan if you’re under 26 years of age — even if you’re financially independent, out of school and married.
Pros? Typically, this is less expensive than some other options because the employer might pick up some of the cost. It can be especially cost-effective if your loved one already has a family plan. For example, if your husband has himself and your two children on his plan, adding another family member may not change the cost at all.
Cons? You usually have to make this decision within 30 days and your loved one must notify his or her HR or benefits office within that timeline. The premiums your loved one pays may also go up (sometimes significantly) when they add you to their plan.
How to get it? Your loved one must talk to their HR or benefits office and complete paperwork to make a new mid-year benefits election.
3. Enroll During a Special Enrollment Period
Insurance marketplaces under the Affordable Care Act are typically open for enrollment in the last few months of the year. But if you have a qualifying event — and losing coverage because you lost your job counts — you can enroll during a Special Enrollment Period.
What is it? A Special Enrollment Period is a 60-day time period after a qualifying event. During this time, you can complete an application and buy insurance on the Healthcare Marketplace, taking full advantage of any subsidies and other benefits you might qualify for.
Pros? Subsidies may help you cover the cost of an insurance premium, especially if your income has been reduced by a job loss. If you purchase insurance through the Marketplace, you know the plan meets ACA requirements as far as benefits and taxes are concerned.
Cons? Some people find the process daunting or confusing. You have to make full premium payments on time to keep your insurance once you accept an offer.
How to get it? Compare plans through the Healthcare Marketplace or start with a service such as TrueCoverage.
4. Apply for Medicaid
If you’ve lost your job, then that means you’ve likely experienced a loss in income. It’s worth exploring whether you qualify for Medicaid in your state.
What is it? Medicaid is a state-sponsored health coverage option that pays for medical care for individuals of low income levels. The exact income requirements depend on your state, but when you apply for coverage through the Healthcare Marketplace, you can enter some information to find out if you might be eligible to apply for Medicaid.
Pros? Medicaid doesn’t cost anything for those who qualify for it. You can also qualify for it month-to-month, which means you can get coverage under the plan if you qualify and then end your Medicaid benefits once you find a new job.
Cons? State-sponsored programs have different limitations, and not every provider accepts Medicaid.
How to get it? If you believe you’re eligible, find your state agency and contact it to find out where and how to apply for benefits.
5. Purchase Short-Term Insurance
If you only need coverage for peace of mind for a short period of time, you might consider buying short-term medical insurance.
What is it? Short-term health insurance are commercial plans you can buy to cover yourself for a couple of months (typically less than a year). These are not ACA-sanctioned plans, and they typically don’t come with all the benefits of a full health care plan. They’re usually meant to reduce the costs associated with hospital stays or major medical care should an unexpected injury or illness occur.
Pros? Short-term health insurance can be especially affordable, especially for healthy people. And you can purchase it even if you’re not in any type of enrollment period.
Cons? These plans don’t usually cover all medical expenses, including doctor’s visits or preventative care. They may not cover maternity or behavioral health care either.
How to get it? Shop online or work with a broker to get coverage.
Whatever type of insurance you’re looking for, consider starting your search on TrueCoverage. Contact us and get in touch with one our insurance experts for help getting the coverage you need, today.