I lost my job. What should I do about health insurance?
I just lost my job. I know I should be hearing about COBRA soon, but I've also heard it's expensive (especially when you are unemployed!) Are there other options? What should I do about health insurance?
Losing a job can be very stressful. The good news is COBRA isn't your only option because you cannot be denied health insurance because of any pre-existing conditions. This means you have a lot of health insurance options. And more options means the opportunity for more savings and better plans. You have 60 days after losing your job to make a decision.
Here are four health insurance options to consider:
The last thing you want to worry about when losing your job is losing your health insurance. When you receive your COBRA packet, it can feel like the path of least resistance to keep the same health coverage that you are used to, but this is almost never a good idea.
Prior to health care reform, it made sense for people with pre-existing conditions to be on COBRA because they would get denied on the individual market. Now, no one has to think about pre-existing conditions. In fact, there are only a handful of reasons to choose COBRA because COBRA is very expensive.
If you have met your deductible for the year, need access to providers that aren't available in networks or individual plans, are about to qualify for Medicare, are set on a low deductible, or come from a healthy, young company then it might make sense to choose COBRA during this time of transition. Otherwise, you have better health insurance options. Don’t get strangled by the snake!
On-exchange health insurance
Since losing a job counts as a qualifying event and allows you a special enrollment period, you can start looking into plans on the marketplace. Depending on your income, you may qualify for a subsidy (help from the government paying your premiums).
There are hundreds of plans to choose from on Healthcare.gov or your state's exchange website. Overwhelmed with sifting through the plans on your own? We have noncommissioned advisors who would love to help you.
Off-exchange health insurance
If you aren't worried about getting a subsidy, then off-exchange health insurance is a great option. These plans are typically sold online or through health brokers. If you can't get a subsidy, then it's definitely worth comparing on-exchange and off-exchange health insurance options to find the best, most affordable strategy for you.
Short-term health plan
If you think this time of transition will be short (less than a year) and don't have significant health expenses, a short-term health plan may be just what the doctor ordered (pun intended). Short-term health plans are renewable in one to three month increments and typically can last for up to a year. These plans are inexpensive compared to more comprehensive coverage but do not cover pre-existing conditions or Essential Health Benefits. Here is a more in-depth discussion that will help you determine whether or not a short-term health plan is right for you.
Losing employment can be very stressful, but the good news is you have several health insurance options. Make sure you compare plans (or let us do it for you) to ensure you are getting the best, most affordable health plan for you and your family.
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