Keeping Health Coverage While Between Jobs
Health insurance is not just nice to have – it is essential to your family’s well-being. If you are between jobs, you have several options for keeping health coverage until you start a new position.
“COBRA” stands for the Consolidated Omnibus Budget Reconciliation Act. This law gives workers who lose or leave their jobs the right to continue group health benefits for a limited time – 18 months after leaving the job. The disadvantage of COBRA is the expense. You have to cover the entire premium yourself, in addition to a small administrative fee.
You qualify for the Special Enrollment Period for up to 60 days after you lose employer-sponsored health coverage. This means you can buy and enroll in a new plan through the Health Insurance Marketplace. During the application process, you can find out if you qualify for federal financial assistance (tax premium credits; cost-sharing reductions).
Spouse’s Health Plan
If your spouse has employer-sponsored health insurance, the best option may be to be added to that plan. The life event of losing your job will qualify you for the Special Enrollment Period, so you should not have to wait for open enrollment. Group plans are typically less costly than COBRA or individual insurance, but the quality of coverage may vary significantly.
Short-Term Health Plan
This is an inexpensive way to fill the gap between employer health plans. In some states, you can have a short-term plan for one year and extend it twice, for a total of three years. Other states limit short-term health plans to three or six months, or don’t allow them at all. The cons of this option include limited coverage and higher out-of-pocket costs. If you live in a state that does not allow short-term plans, it is not an option at all.
Health Savings Account (HSA)
If you paid into an HSA before leaving your last job, the funds will still be available to you. You can use your health savings account to pay for eligible medical expenses. This can help lower your health care costs while you are between jobs.
Medicaid is a health coverage aid designed for low-income individuals and families. This option may or may not be available, depending on your income and where you live. In many states, you may qualify for Medicaid with an income up to $35,000 per year for a family of four. This is a low-cost option with minimal out-of-pocket expenses. One disadvantage is that not all health care providers accept Medicaid. The income requirements are another disadvantage.
Our Agent Can Help
If you are leaving a job, find out when your health coverage ends, so you will know when your new coverage should begin. If you are planning to start a new job, find out when your health coverage will begin. You may only need to fill the gap for a brief period of time. Our experienced agent can help you find the best and most affordable option for keeping your health coverage while you are between jobs.