Any cut in income will influence your approach to health insurance for you and your loved ones.
This article discusses ways to get health coverage caused by job loss, especially if it’s the result of the Coronavirus pandemic. A lost job due to Coronavirus is common, and there are several solutions.
If you lost job-based health insurance, there are many scenarios, and we address the most likely ones below.
Our first and most important advice is that you in case you lost your job due to coronavirus is to discuss your circumstances with your employer, the insurance company, or your chosen Health Insurance Marketplace (AKA Health Insurance Exchange).
MOST of your health insurance options are time-sensitive! Our second piece of advice is to start your investigation now!
Most working-age Americans (and their families) receive insurance through their employers. When you lose your job, you will lose your health insurance.
The Families First Coronavirus Response Act (FFCRA) enacted in March 2020, ensures those with insurance, and people qualifying for Medicaid, receive COVID-19 (Coronavirus) testing. A lost job due to Coronavirus does not mean you can’t get tested. There is a safety net.
Let’s look at these health insurance options for the recently unemployed.
Option 1: COBRA Health Insurance
COBRA (Consolidated Omnibus Budget Reconciliation Act) lets you keep the same insurance plan you had with your former employer. The downside is that you must pay the full premium, i.e., your share, the contribution your employer was making, plus a 2% administration fee. If you lost job-based health insurance, COBRA is the first option to consider, and your employer typically informs you.
COBRA health insurance is usually an expensive option. Still, it MAY be appropriate if you will regain your income quickly, or, if you, or a dependent, are in medical treatment and prefer to stay with the same network of providers.
To use the COBRA option, you must sign up within 60 days of losing or leaving your job. The maximum extension is 18 months, but you may switch plans during Open Enrollment or if you have another SEP. See our article ‘Sign up for COBRA.’
Option 2: Health Insurance Plans for Family
If another member of the family, (usually your spouse) has, or is entitled to, employer-sponsored group health insurance, consider joining their plan. Being added to a spouse’s insurance plan is often a cost-effective choice for people who lost health insurance – for any reason, COVID-19 or other.
For younger people, you can join your parent’s plan if you are less than 26 years of age. Both these options have a 30-day enrollment window.
Option 3: ACA Special Enrollment Period
Being laid-off or losing one’s job ( or experiencing a severe change in financial circumstances) triggers a Special Enrollment Period (SEP). You have 60 days to enroll in alternative ACA (Patient Protection and Affordable Care Act / Obamacare) compliant plans.
Premiums for SEP plans often qualify for tax relief and income-related subsidies, meaning you may be eligible for low or no-cost options, depending on your annual income. Your Health Insurance Marketplace will help you find the plan that best meets your new circumstances.
Option 4: Medicaid
If you lose your job and have not yet found another, or you move to another position with lower pay, the same 60-day to enrollment window, like the SEP mentioned above, is available to you. You can request to modify your (independent) market plan, OR (depending on your state regulations), you might qualify for the Federal/State health insurance program, Medicaid.
In most states, you will qualify for Medicaid if your monthly household income is below $2,950 ($1,400 for an individual).
If you believe you and your family qualifies, contact (BY PHONE) your States’ Medicaid office directly.
Here’s a link to find your States Medicaid Phone Number: https://www.medicaid.gov/about-us/contact-us/index.html
Medicaid provides coverage that meets the ACA standards, but services may be more limited than employer-provided or open-market plans. Although Medicare may provide coverage at little or no cost, you MUST ENROLL to take advantage. Please note: You may find that tax relief and subsidies make Health Insurance Marketplace plans more flexible and a better value. EXPLORE BOTH OPTIONS.
Option 5: Short-term health insurance plans
If you are (very) confident that you will soon be re-employed in a job that offers employer-provided insurance, or you are moving abroad, consider a short-term insurance plan. Short-term insurance plans are often less expensive than ACA compliant plans, but cover fewer medical services, and DO NOT receive subsidies or tax relief on the monthly premiums.
The Coronavirus pandemic has negatively affected businesses all over the Country. Often their first reaction was to reduce costs by furloughing or terminating employees. If this has happened to you, remain positive, and take advantage of every service that your State provides. The ACA helps you in this time of need, each State provides Medicaid services, and the Health Insurance Marketplaces are great resources to provide your family with viable health coverage.
With all five Insurance options, you must provide documentation to enroll:
- Date of termination
- Date of insurance cessation (when your Employer-provided insurance ends)
- Evidence of an applicable “qualifying event” (Examples: Marriage, Divorce, Lowered income.)
OUR FINAL ADVICE is the same as our first, discuss your circumstances with your employer, insurance company, or your chosen Health Insurance Marketplace. Most of your options are time-sensitive, so please, act now!