Company Provided Health Insurance
If you're laid-off, your employer should review the benefits you are entitled to receive when you leave employment. However, if it isn't clear to you what you're eligible for, ask your employer about eligibility for continuing cover through COBRA.
Your company, if the firm has over 20 employees, is mandated by law to offer health insurance coverage through COBRA to terminated employees for 18 months. You will need to pay for this coverage. In some cases, employers will pay for coverage for a limited time as part of a severance package.
State Health Insurance Coverage
Check with your State Health Department. Some states have health insurance coverage available, for a fee, for both individuals and families. If coverage is available, there are typically income and asset guidelines for participation.
There are also other health insurance options available. Steve Trattner, President and Chief Marketing Officer of Cinergy Health, shares his health insurance tips for unemployed workers:
- COBRA: If you lose job-based coverage, you only have a 60 day window of time to enroll for health insurance coverage that continues your company provided health benefits for at least 18 months.
- Start shopping for individual insurance early, insurance is complicated and you don't want to make a rash or uneducated decision.
- Do not wait to secure health insurance. If there are any existing medical conditions and you are being dropped from your previous health plan, there's a 63-day window to get into another plan without a waiting period on the pre-existing conditions.
- Evaluate health plan options based on your individual healthcare needs. Major medical insurance plans will permit an individual to select a high deductible, say $5,000, in order to get a very low affordable premium. This type of plan will provide coverage if the individual faces a catastrophic medical event, but isn't going to cover their routine and predictable healthcare needs. There are also Short Term Medical plans available that expire at the end of a 6 or 12 month term and cost much less than major medical plans.
- Choosing a policy that doesn't include several treatment facilities is also an option to lower your premium rates. There are low-cost limited medical plans which provides coverage for the individual's more immediate needs like routine doctor visits and short term hospital stays without a deductible.
More Insurance Options
- Insurance companies and various school's alumni association may offer temporary insurance in your state.
- Unions, trade associations, and members-only warehouse clubs like BJ's wholesale and Costco may also offer various forms of health insurance, including screening, vaccinations and other medical procedures.
- As unemployment will reduce household income and/or preexisting conditions may prevent you from qualifying, some high-risk pools or aid from individual states will help pay for health insurance.
- If under 26, unemployed workers can get on their parents' plan. A provision in the health care reform bill allows adult children who don't have access to employer-provided insurance to stay on their parents' group plan until age 26. Qualifying children need not be full-time students or dependents.
- Find out whether your children qualify for the Children's Health Insurance Program.
- People who receive Temporary Assistance for Needy Families (TANF), also commonly known as welfare, automatically qualify for Medicaid. Other people also may qualify based on their income and resources, including high medical bills, limited time expiration, low-income children under 19, pregnant mothers, and children growing too old for foster care.
It's important to know that you have limited time to decide on health care options, so carefully review options for maintaining coverage as soon as possible after your employment terminates.