Keeping Health Insurance After a Layoff
Losing your job can be a difficult and stressful time. As the federal government continues its pursuit of keeping inflation at bay, it is expected that some contraction will occur in the labor force as a result.
This has led Challenger, Gray & Christmas, Inc., to report that layoffs are expected to increase this year. Whether you have already been laid off or there are rumors your company may be letting employees go in the near future, it is important to understand your options when it comes to your health insurance.
Here are the most common ways unemployed individuals obtain health insurance coverage when they have been laid off:
ACA Marketplace: Insurance can be purchased through the Affordable Care Act (ACA) Marketplace if you lose your job and your employer-sponsored health insurance plan ends. Subsidies are available through the ACA that can significantly offset how much you pay in premiums every month.
Short-term health insurance: Short-term health insurance plans are designed to provide temporary coverage for people who are between jobs or waiting for other coverage to start. The plans commonly last from one month to up to three years in some states. It is important to note that many short-term health plans have limited benefits and coverage limits as well.
Spouse’s employer-sponsored health insurance: Losing your job is typically a qualifying event that allows you to join your spouse’s employer-sponsored health insurance plan. Depending on the coverage, a spouse’s health insurance plan may be the best option in many cases.
Private health insurance: You can purchase private health insurance directly from an insurance company if you lose your job and your employer-sponsored health insurance plan ends. You may be subject to health underwriting, which could impact your premium or ability to obtain coverage at all if you have preexisting health issues.
COBRA: The governmental act commonly known as COBRA allows you to keep your employer-sponsored health insurance plan for up to 18 months after you lose your job. Keep in mind, however, that you will be responsible for paying the full premium yourself, which can often be very expensive. Because of its cost, COBRA is often chosen by those unable to obtain coverage elsewhere.
Medicaid: Often thought of as coverage of last resort, Medicaid may be available if you lose your job, and your income drops significantly. Medicaid is a government-sponsored health coverage option that provides free or low-cost health insurance to people with limited income.
Health insurance is supposed to be a safety net for you and your family. Making sure you have coverage can help ensure that your personal finances aren’t catastrophically depleted should someone become ill or injured. For assistance navigating your options if you expect to be laid off, contact our office today.