Other Healthcare Options After Termination Besides Cobra
Although COBRA can be a convenient way to continue accessing a group health coverage insurance policy after a qualifying event, some states provide alternative ways of getting health insurance due to the complexities involved with enforcing COBRA. These state-specific options often allow for an individual to transition from group health insurance coverage to an individual plan. Although this type of plan is often more expensive, having the option can be helpful when there are complications with COBRA health insurance continuation. Selecting a new individual plan can also allow you to modify the healthcare services that youre covered for.
In many cases, state laws put a requirement on the length of employment that is necessary before COBRA alternatives are accessible to a former employee. For example, its common to require at least three months of employment at your previous employer if you wish to take advantage of alternative options provided by your state.
To see all of your marketplace options under the ACA , visit Healthcare.gov. Note that qualifying events enable you to access the special enrollment period for health insurance marketplace plans and you are not required to wait for the standard ACA open enrollment period. The ACA also guarantees coverage for pre-existing conditions.
Cobra Vs Marketplace Insurance Options
If youve ever been laid off from a job with health insurance, youre probably familiar with COBRA continuation coverage. The Consolidated Omnibus Budget Reconciliation Act gives most employees losing a job the right to continue health insurance benefits for a certain period of time , typically at an increased personal cost.
Known for being an expensive, short-term solution, COBRA was once the only option available to cover the health insurance gap between jobs. Finding a comparable individual or family policy on the open market used to be impossible or out of reach for most people. That has changed with the passing of the Affordable Care Act , which is also known as “Obamacare.”
Under the ACA, the governments Health Insurance Marketplace provides individuals a way to shop for coverage on their own, to see how individual and family plan prices compare to COBRA, and decide which option makes the most sense.
COBRA coverage is generally available if your former employer had at least 20 full-time employees. Depending on your states laws, you may also qualify for insurance continuation if your employer had fewer employees.
What Might Cause Me To Lose Job
You can lose job-related coverage for a number of reasons, such as:
If youre laid off or quit
If your hours are reduced
If your employer no longer offers health coverage
If your employer stopped offering health coverage and switched to an Individual Coverage Health Reimbursement Account
If youre a dependent and the subscriber for your plan qualifies for Medicare
If youre a dependent and the subscriber for your plan dies
If youre a dependent and you get legally separated or divorced
If you turn 26 and no longer qualify as a dependent on a parents employer-sponsored plan
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Employment Ending Due To Termination Or Separation
When you, the employee, and your covered dependents are no longer eligible for the employer contribution toward PEBB benefits due to termination or separation, PEBB health plan coverage may be continued by self-paying the premiums and applicable premium surcharges to the Health Care Authority through PEBB Continuation Coverage , with no contribution from the employer .
The PEBB Program will mail the PEBB Continuation Coverage Election Notice to you after coverage is terminated. The mailing can take up to 14 days.
In cases of termination or separation, if you choose to continue PEBB benefits by self paying the premiums and applicable premium surcharges, complete and submit the PEBB Continuation Coverage Election/Change form. The PEBB Program must receive your form no later than 60 days from the date your PEBB health plan coverage ended or from the postmark date on the PEBB Continuation Coverage Election Notice sent to you, whichever is later.
If you do not enroll in PEBB Continuation Coverage , PEBB benefits will terminate the last day of the month in which you are eligible for the employer contribution or the last day of the month in which employee premiums were deducted.
Since I Was Laid Off Is Medicaid An Option For Me
Medicaid may be an option for you, depending on where you live. If youre in a state that has expanded Medicaid, coverage is available if your income is up to 138% of the poverty level. If your state has not expanded Medicaid, eligibility is significantly more restricted. Contact your state Medicaid office or the exchange to see if you could qualify for Medicaid until you get another job. But you can qualify for premium subsidies even with an income below the poverty level in those states, if youre receiving any unemployment compensation in 2021.
Assuming youre in a state that has expanded Medicaid, youll qualify for Medicaid during the time that you have no income. You can then switch to a private plan in the exchange or to an employer-sponsored plan if you get a job later in the year and your total annual income is going to end up being more than 138% of the poverty level. Youll have the opportunity to make that coverage change if and when your income picks up again, but the state will not terminate your Medicaid coverageunless you ask them to do sountil the COVID pandemic emergency period is over this is due to federal rules that prevent coverage terminations for states receiving additional COVID-related Medicaid funding, which are states are receiving.
Read more about avoiding or escaping the coverage gap.
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Does Cobra Apply To Dental Coverage
You can usually hang on to your insurance for 18 months after losing your job, as long as you werent fired for serious misconduct. If youre covered by the Consolidated Omnibus Budget Reconciliation Act or COBRA you stay insured by paying both the employee and employer share of the premiums. Your employer can offer you a longer coverage period in your severance package if he chooses.
Creating Just In Case Checklist For Potential Layoff
The best time to prepare for something bad that might happen is before it happens. That way youre not stressed and panicked, which makes you less effective. So, part of being proactive is creating your what-if checklist now rather than procrastinating until it happens.
Here are a few thoughts to get you started:
- List your most marketable skills and strengths. You can start from all the things your supervisor and/or clients and/or friends and/or colleagues ask you to help with.
- Next, list all the types of positions that could benefit from someone with those skills and strengths.
- After that, investigate the availability of those types of positions .
- Score the plausibly available opportunities from the above list by how excited youd be to pursue them, and how well theyre compensated. Figure out how important each of those is for you, and rank them by a weighted score . Order the opportunities by their composite score.
- Identify all your financial resources that could help bridge a loss of income for a few months. The longer your runway to get the next job or your first business revenue, the less stressful it would be should you lose your job. The next checklist can help you extend that runway.
This process can help you see that losing your job doesnt have to be a catastrophe. In fact, it might even have you start thinking about possibly leaving your current position proactively!
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Applying For Cobra Coverage
In order to begin COBRA coverage, an individual must confirm that they are eligible for assistance according to the requirements listed above. Typically, an eligible individual will receive a letter from either an employer or a health insurer outlining COBRA benefits. Some individuals find this notification difficult to understand because it includes a large amount of required legal information and language. If you have any difficulty determining whether you are eligible for COBRA or how to begin coverage through this program, contact either the insurer or your former employer’s HR department.
For individuals either not eligible for COBRA or those searching for alternatives, there are other options, such as a spouse’s health insurance plan.
For individuals either not eligible for COBRA or those searching for alternatives, there are other options. In some cases, a spouse’s health insurance plan may be a possibility. Or you might explore your options on the federal health insurance marketplace or a state insurance marketplace. Loss of a job will open up a special enrollment period.
Options To Replace Your Benefits Exist But Some Are Only Open For A Short Time After Your Current Plan Ends
If youve been terminated or are otherwise losing your coverage, there are other good plans to consider. Some are tied directly to the date your current plan ends and only available for a short time. Its important to know that you dont necessarily have to go with the option your employer or current benefit provider suggests. If youre healthy, youll find better value at lower cost elsewhere. Whats important is that you gather the information now. You dont want to miss a deadline for transfer to a new plan, pay too much, or take the risk of having no insurance at all.
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Preparing Your Finances For A Potential Layoff
If you suspect a job loss is in your near-term future, heres how you can best prepare yourself financially.
- Try to maintain or even increase your liquidity. This means avoiding paying more than the minimum required on low-interest debts .
- If you dont already have one, consider opening a fixed-rate Home Equity Line Of Credit while you still have a salary. Then, dont borrow anything from it until and unless you have to. Its important to try and make this a fixed-rate HELOC, since the majority of HELOCs are variable-rate, which can trap you as market interest rates rise.
- Consider opening one or more new with zero- or low-interest teaser rates. This isnt intended to borrow now, but rather to provide you with access to inexpensive credit if and when you lose your job. Once your salary goes away, youre unlikely to be able to open such accounts.
- Try to cut your spending proactively now , and set aside more money into your emergency fund. This will help in two ways. First, it will increase your access to money to help bridge the time between your last salary from your current job and your first from the next job. Second, it will help you get used to spending less, which will extend the time your existing resources could last.
- Consider if you should temporarily change your allocation of savings from long-term high-risk to short-term low-risk .
- Look for ways to diversify your income, e.g., by starting a side hustle.
Danielle Miura suggests the following ideas :
If I Lose My Job Or My Workplace Drops My Insurance Can I Get Health Coverage Through My States Marketplace
Most likely yes. You can shop for insurance online through the Marketplace. If you lost your job or your employer dropped your insurance, you will qualify for a special enrollment period. You may also qualify for a subsidy to help you purchase insurance, depending on your income.
You can shop and enroll online at healthcare.gov or if you need assistance, you can call a toll-free number to get your questions answered. You can also ask for face-to-face help in your area. To find a location near you, go to localhelp.healthcare.gov.
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How To Get Health Insurance If Youve Been Laid Off During The Coronavirus Pandemic
Last week, another 6.6 million Americans filed for unemployment benefits, bringing the current total of coronavirus-related unemployment claims to 17 million. That is 11 percent of the U.S. labor force. What makes this burst of job losses different from any other economic crisis in history is how quickly they happened, as businesses have had to shutter with little notice. The government is working on economic relief efforts, including stimulus checks and loans and bailouts for businesses.
One complication for many people is that its not just their income they lose when they lose their jobs nearly half of Americans receive health insurance and benefits through their employer. According to an estimate from Health Management Associates, between 12 million and 35 millions Americans could lose their employer-sponsored insurance if layoffs continue as they are predicted to. So what does this mean for health insurance?
Many people who lost employment are now eligible for health insurance through the Affordable Care Act or Medicaid. However, the ACA only helps people who recently lost employer-based insurance benefits people who are unemployed due to coronavirus layoffs but did not receive insurance through their jobs arent eligible to sign up for coverage at healthcare.gov.
I would do almost everything different from whats being done right now, said Andy Slavitt, who ran the Medicaid, Medicare and ACA exchanges during part of the Obama administration, told The Hill.
Returning To Work After Layoff
When you return to another position with a state agency within 24 months of leaving the original position, you may be eligible for the employer contribution toward PEBB benefits for each month you are in pay status for at least eight hours . Upon hire, you must notify your employer that you may be eligible under WAC 182-12-129.
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Did You Lose Your Health Insurance Because Of The Coronavirus Pandemic Coverage Options For Laid
Vice President, Health Care Coverage and Access, The Commonwealth Fund
Vice President, Health Care Coverage and Access, The Commonwealth Fund
The millions of people who lose their health insurance along with their jobs because of the coronavirus pandemic can sign up for coverage through the Affordable Care Act marketplaces
The first thing to do after losing your job or if you are uninsured is to check out your coverage options at HealthCare.gov
More than 26 million people filed unemployment claims with the U.S. Department of Labor over the five-week period ending April 18. This unprecedented number of filings may climb if more businesses lay off workers as the economic fallout from the coronavirus pandemic continues. Forecasters estimate that the unemployment rate could hit 20 percent for the month of April. For context, during the Great Depression, unemployment peaked at 25 percent.
Millions of workers who have lost their jobs also will lose their health insurance. The potential severity of COVID-19 means that being uninsured could leave people at risk for catastrophic health care costs. Here are some key things people who lose their jobs or who are currently uninsured should know.
Help Finding A New Job
Another thing to consider in your exit package is help finding a new job. Some companies offer laid-off workers the option to take part in an outplacement program. This could include one-on-one career coaching, job training or a service that helps you land a job at another organization.
If this option is available but you won’t be taking part, it may be possible to ask for compensation equal to the amount of funding they would have allocated for you.
Finally, ask your supervisor and colleagues if they’ll serve as a professional reference for your next job, and offer to do the same for them. Remember to share personal contact information in case they also part ways with your former employer.
“Take a deep breath,” Norris says. “It’s not going to be easy, but it’s going to be OK.”
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Duration Of Cobra Benefits
For an employee, COBRA coverage lasts for up to 18 months. A spouse or dependent child who becomes eligible for any reason other than the employee’s qualifying event can continue COBRA coverage for up to 36 months. For example, if the employee dies, the spouse can continue coverage for 36 months.
Different rules apply in some circumstances. For example, if a spouse is receiving COBRA coverage because the employee was laid off, both the employee and spouse would be entitled to receive benefits for 18 months. However, if the employee dies during this 18-month period, the spouse’s eligibility would be extended to 36 months. COBRA coverage can also be extended if the person receiving benefits has a disability and meets other requirements.
Managing A High Cobra Premium
If you’re considering COBRA coverage but you’re concerned about the differences between the cost of insurance coverage through this program and the cost of insurance with the support of an employer, there are a number of important considerations to keep in mind.
When you lose your job, you generally lose your flexible spending account . If a job loss is threatened, you are allowed to spend your entire year’s contribution to the FSA before you become unemployed. If you were going to contribute $1,200 for the year but it’s only January, for example, and you’ve only had $100 withheld from your paycheck for your FSA, you can still spend all of the $1,200 that you were planning to contributesay, by seeing all of your doctors and filling all of your prescriptions immediately.
Upon choosing COBRA, you can change your plan during the employer’s annual open enrollment period and opt for a less expensive plan like a preferred provider organization , or health maintenance organization .
If available, a refundable tax credit called the Health Coverage Tax Credit can be utilized by qualifying individuals to pay up to 72.5% of qualified health insurance premiums, including COBRA continuation coverage. The HCTC program was due to expire on Dec. 31, 2020, but the Internal Revenue Service has extended the program through Dec. 31, 2021.
You can use your health savings account to pay COBRA premiums as well as medical expenses, which could significantly reduce the sting of losing benefits.
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