How to find new health insurance after job loss
How to find health insurance after losing your job
Losing a job is incredibly stressful — especially if you relied on your former employer for health insurance coverage. That’s what happened to Dr. Nathan Schaefer, a Wellmark Blue Cross and Blue Shield member with three young children under the age of six, whose wife is self-employed.
His company went through a restructure, and he didn’t get rehired. This left him scrambling to find an answer to the question of "how to apply for health insurance when unemployed" as he looked for another job. “The last thing I wanted was to have a lapse in coverage,” Schaefer says. “With a young family, you’re always concerned about someone needing medical care.”
Schaefer quickly found a job, but his new health insurance didn’t kick in until the month after his previous coverage ended. “There was definitely some stress and confusion about what my options were for short-term health insurance,” he says.
If you find yourself suddenly out of a job due to circumstances like a layoff or furlough, here’s what you need to know to ensure you (and your family members) continue to have health insurance between jobs.
Don’t wait for Open Enrollment
When you buy your own health insurance (not through an employer), you typically sign up during Open Enrollment, a six-week period in November and December. There are, however, certain circumstances that allow you to enroll in coverage outside that window.
Life changes like getting married, having a baby or losing job-based coverage (no matter the reason) qualify you for a Special Enrollment Period (SEP) You may also qualify for an SEP if your employer stops offering health insurance or a change to part-time status causes you to lose your job-based plan.
A SEP gives you 60 days from the day you lose health insurance to enroll in a new plan, no matter the time of year. The only time you aren’t eligible for a SEP is if you voluntarily drop your job-based coverage while you’re still employed, or if you lose your coverage due to not paying your premium.
Once your SEP begins, you have a few different options for health insurance.
Your options after losing job-based health insurance
1.
You can keep your existing coverage temporarily.
The Consolidated Omnibus Budget Reconciliation Act — a.k.a. COBRA — allows you to keep your job-based health insurance for up to 18 months, even though you’re no longer with that company. The downside is that it can get expensive. According to the U.S. Bureau of Labor Statistics:regular--file-pdf:, employers typically cover 69 percent of the premium cost for family plans . With COBRA, however, you’re on the hook for 100 percent of your plan’s premium — plus a two percent administrative fee.
If you see multiple specialists or are in the middle of treatment for a health condition, coverage, COBRA is usually a good option since it won’t disrupt appointments or force you to change health care providers. An important thing to remember is once you opt into COBRA, you can’t change to a different plan — outside of the standard Open Enrollment window for individual and family plans — until it ends 18 months later.
2.
You can get a new plan.
If you don’t need to or can’t afford to stay on your existing plan through COBRA, you can sign up for a new one through the Affordable Care Act (ACA) Marketplace at HealthCare.gov.
Compare Wellmark’s individual and family health plans
Wellmark offers a variety of ACA health insurance plans in Iowa and South Dakota. Depending on your plan needs and budget, you may be able to sign up for a new plan quickly.
Other options for health insurance coverage
Depending on certain circumstances, you may have a few other options for health insurance between jobs after you lose employer-based coverage. For example:
- If you’re younger than 26 and lose your health insurance, you may be able to enroll in your parent’s current plan.
- If you’re 65 or older, you can sign up for Medicare.
- If your spouse currently has coverage through their employer, you can enroll in their plan.
- If you were the primary source of income for your family and now have little to no money coming in, you may qualify for Medicaid.
With all the changes to the ACA made in recent years, you may have heard about short-term health plans or health care sharing ministries. While these are still available options, they’re generally not your best bet.
Short-term health plans aren’t regulated by the Marketplace and many don’t cover the essential health benefits the ACA guarantees — like preventive care — so despite paying lower premiums, your out-of-pocket expenses could quickly add up. And, health care sharing ministries — typically offered by Christian nonprofit groups — are not insurance and are not legally obligated to pay any of your claims.
Stuck on next steps?
An authorized Wellmark agent can help youfind the right plan to suit your unique situation, at no cost. If you don’t have an agent, you can find one with this tool.
Article resources
Centers for Medicare & Medicaid Services. (n.d.). Tips for helping consumers who are losing employer‑sponsored coverage. https://www.cms.gov/CCIIO/Programs-and-Initiatives/Health-Insurance-Marketplaces/Downloads/Tips-for-Helping-Consumers-Who-are-Losing-Employer-sponsored-Coverage.pdf
HealthCare.gov. (n.d.). If you lose job‑based coverage. https://www.healthcare.gov/have-job-based-coverage/if-you-lose-job-based-coverage/
DOL.gov — FAQs on COBRA continuation health coverage for workers