For most people, losing a job has historically meant losing affordable health care coverage as well. Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), most employers must offer terminated employees continuation coverage of the group health insurance provided while employed. That COBRA coverage, though, is usually offered at full price plus a two-percent administrative fee, which makes the monthly premium unaffordable if you’re newly unemployed. Thanks to the Affordable Care Act, however-new options are available in the Health Insurance Marketplace.
COBRA Coverage and Costs
Health Insurance Options for the Unemployed
If you lose your job and do not have a spouse who gets insurance through work that you could join, you still have the following options for health insurance:
- Elect COBRA continuation coverage through your former employer
- Visit the Marketplace to find plans available and affordable to you
- Purchase private insurance
- Remain uninsured
Keep in mind that failing to have health insurance not only puts you at risk physically but financially, since you might be fined under the ACA individual responsibility mandate during tax season.
Loss of job-based health care coverage qualifies for a special enrollment period in the Marketplace. This means you don’t have to wait until the usual open enrollment period in order to sign up for coverage. In the Marketplace you’ll find several affordable plan options according to your anticipated income for the year. An estimated eight out of 10 people who choose a Marketplace plan pay less than $100 a month as a premium, in large part due to tax credits and financial subsidies that can save you money. Additionally, depending on your state, household size and projected income, you might qualify for no- or low-cost Medicaid benefits.