Lost Your Health Coverage Due to COVID-19? Here Are Some Options
The social and economic consequences of the COVID-19 coronavirus are beginning to sink in across the country. Unemployment claims are skyrocketing and officials of the Federal Reserve have estimated that as many as 47 million people could lose their jobs as a direct or indirect result of coronavirus.
If you’re among the newly unemployed, one of the most pressing questions you may be facing amid this crisis is what to do for health insurance. What are your options? How do you enroll? And is there any special help available to you?
The bottom line is you have options, and more than likely those options include COBRA coverage or coverage under the Affordable Care Act (ACA). Here is a quick breakdown of COBRA and ACA coverage, and some tips for finding the right plan for you:
If you were laid off but your employer is still in business, you may be able to extend your coverage under your employer-sponsored plan through the federal law commonly known as COBRA. COBRA allows you to pay out of your own pocket for coverage under your old plan for up to 18 months (longer in some states).
The trouble with COBRA is that it can be costly. When you were working, you were only paying a percent of your total monthly premium. The rest (often 75% or more) was covered by your employer. Under COBRA, you’ll have to pay the full premium yourself.
Coverage under the Affordable Care Act
Beyond COBRA, you can purchase an individual or family health insurance plan on your own under the rules of the Affordable Care Act (ACA). Most people need to wait for the annual open enrollment period each fall to sign up for a new plan, but the loss of employer-based coverage is a “qualifying life event” that gives you a 60-day window to enroll.
You can shop for individual or family coverage through the government-run health insurance marketplace for your state, directly through the insurance company, or through a licensed online health insurance marketplace like eHealth.com. Here are some tips to guide your shopping and ensure you find the best individual or family coverage:
- Compare your options: Compare plans from multiple insurers to make sure you find the best match for your needs and budget. Consider looking at plans available through both private licensed marketplaces as well as government-run websites. Government-run websites typically present you with only a selection of the plans available in your area.
- Look for plans that cover your prescriptions and preferred doctors: If you take prescription drugs on a regular basis or want to continue seeing a preferred doctor, make sure that any plan you consider will keep your drugs affordable and your doctor in-network. Some online marketplaces can help you organize your options based on these factors.
- See if you qualify for government subsidies to make coverage more affordable: In most states, if your annual household income is less than 400% of the federal poverty level (about $51,000 for an individual or $105,000 for a family of four), you may qualify for government subsidies applied up front to your monthly health insurance premium. This can make your new health plan significantly more affordable.
- Pay attention to deductibles and out-of-pocket costs: Some health insurance shoppers never look beyond the monthly premium but deductibles, copays and other out-of-pocket costs are just as important. A low-premium plan with a high deductible might be a good match for someone young and healthy, but someone with chronic medical conditions may save money in the end by choosing a plan with a lower deductible. Either way, make sure you can afford the deductible in an emergency.
- Get personal help and advice when you need it: Health insurance is complex and it’s only natural to have questions. If you don’t find answers to your questions while shopping online, reputable private marketplaces can put you in touch with a licensed agent by phone. It never costs you anything extra to enroll through an agent.
- If you’re under age 30, consider a “catastrophic” plan: Catastrophic plans cover all the basic benefits of other ACA plans but are often more affordable. The catch is that they can come with a higher annual deductible and are primarily intended for people under age 30 (with some exceptions). Another catch: you cannot use government subsidies to help pay for a catastrophic plan.
With an ongoing public health crisis unfolding around us, it’s an especially scary time to go without health insurance coverage. If you’re not eligible to enroll in a family member’s plan and neither COBRA nor ACA coverage are options for you, you may also qualify for coverage through Medicaid, depending on your circumstances. To find out more about Medicaid eligibility, contact your state’s Department of Insurance.