Did you lose your job? How one can hold your health insurance or discover new insurance now.

Most Americans under 65 get their health insurance from an employer. This makes life pretty easy as long as you have a job that offers solid health benefits: all you have to do is sign up if you're eligible, and when your employer offers some options to choose from, pick the one that best suits yours Required every year during your employer's annual enrollment period.

The disadvantage of having health insurance linked to employment is that losing your job also means losing your health insurance, which adds to the stress of the already stressful situation.

The good news is that you have options – probably several, depending on the circumstances. Let's take a look at what you need to know about health insurance if you've lost your job and are about to lose your employer-funded health insurance.

Can I take out self-insurance once I have lost my job?

If you lose your work-related health insurance, you don't have to wait until fall to sign up for a new ACA-compliant plan.

Although the COVID-related special enrollment window for individual / family health insurance has expired in most states, you are entitled to your own special enrollment phase due to the loss of your employer-funded health insurance.

That way, you can sign up for a plan through the marketplace / exchange and take advantage of the available subsidies (and bigger than ever thanks to the American Rescue Plan) without having to wait until 2022 to get coverage.

If you sign up before your insurance loss, your new plan will take effect on the first of the month after your old plan ends, which means you'll have seamless coverage if your old plan ends on the last day of the month.

Your special enrollment period is also 60 days after your loss of insurance, although you would have a coverage gap if you wait and sign up after your old tariff ends, as your new tariff will not go into effect retrospectively.

If you find yourself in this situation, you may find that a short term health plan is a great option to fill in the void until your new plan takes effect. Short-term plans don't cover pre-existing conditions and are not regulated by the Affordable Care Act (ACA). However, they can provide pretty good protection for unexpected medical needs during a temporary window of time when you would otherwise not be insured.

Double-check your options during open enrollment

If you are enrolling for coverage now during your special enrollment period, remember that you will need to review your insurance coverage during the upcoming open enrollment period starting November 1st, even if you enroll relatively late in 2021, Your new plan will reset on January 1st with new prices and possibly some changes in coverage. New plans may also be available in your area for 2022.

Your specific sign-up period (combined with your insurance loss) gives you the opportunity to find the best plan for the remainder of this year that suits your needs. And if in 2022 you still need insurance coverage that you have purchased yourself, the upcoming open registration phase gives you the opportunity to ensure that you optimize your insurance coverage for the next year as well.

COBRA (or continuation of the state) versus self-purchased coverage

Depending on the size of your employer, you may be offered COBRA. And even if your employer is too small for COBRA, you may have access to state continuation (“mini-COBRA”) depending on where you live. With both options, you can temporarily continue your existing insurance coverage instead of immediately switching to a new single market plan.

If a COBRA or state continuation is available, your employer will notify you and give you information about what to do to activate the continuation of insurance and how long you can keep it.

Typically, you will have to pay the full cost of COBRA or state continued insurance, including what your employer previously paid on your behalf – which probably made up the bulk of the premiums. But until the end of September 2021 (so only one month left), the federal government will pay the full cost of COBRA or state continued insurance for people who have involuntarily lost their jobs as part of the American Rescue Plan (ARP).

For much of this year, the COBRA subsidy, which is about to expire, has changed the calculation that is normally used when deciding whether to continue an employer-funded plan or switch to a self-acquired individual / family plan. But from the end of September the normal decision-making process will apply again. And when the COBRA grant ends, you have a special enrollment deadline that allows you to switch to an individual / family plan at that point if you wish.

COBRA coverage vs. health insurance in the individual market

Here are some things to keep in mind when deciding between COBRA and an individual health plan – either at the beginning of or after the COBRA grant expires on September 30th:

  • ACA Marketplace Subsidies are now available for all income levels based on coverage costs in your area (the American Rescue Plan has removed the income cap for eligibility for 2021 and 2022). And the subsidies are sizeable, covering most of the premium costs for the majority of marketplace participants. Unless your employer continues to subsidize your COBRA coverage after the federal grant expires, you will likely find that the monthly premiums are lower when you sign up for a plan through the marketplace, as opposed to continuing your employer-sponsored plan.
  • Have you already spent a significant amount on out-of-pocket expenses this year under your employer-funded plan? You will almost certainly start at $ 0 when switching to an individual / family plan, even if offered by the same insurer that offers your employer-sponsored coverage. Depending on the specifics of your situation, the money you've already paid for medical expenses this year could make up for the lower premiums you're likely to see in the market.
  • Do you have any specific doctors or medical facilities that you need to keep using? You should carefully review the provider networks of the available individual / family plans to see if they are on the network. And if you have certain medications that you need, you should be sure that they are on the forms of the plans you are considering.
  • Are you entitled to a premium grant if you switch to an individual / family plan? If you qualify, you will need to shop on your exchange / marketplace as there are no subsidies available if you buy your plan directly from an insurance company (you can call the number at the top of this page to be connected with a broker) Can help you sign up for a plan through the exchange). And here too, as a result of the ARP, the subsidies are higher and more widely available than usual; it will stay that way in 2022.

Free health insurance if you become unemployed in 2021

If you have even a week of Unemployment Benefit in 2021, you are entitled to a Premium Grant that fully covers the cost of the two cheapest Silver plans on the market / exchange near you by the end of the year.

The grant is also likely to cover the full cost of many of the Bronze plans and possibly some of the Gold plans, depending on the prices of the plans in your area of ​​residence. This is a special subsidy scheme created by the ARP for 2021 only.

In addition to the grant that allows you to receive a free Silver plan, it also ensures that all available Silver plans have a full co-payment.

What if my income is too low for subsidies?

To be eligible for Premium Subsidies for a Marketplace purchased plan, you must not be eligible for Medicaid, Medicare, or any employer-sponsored plan and your income must be at least 100% of the federal poverty line. (As noted above, unless you are eligible for Medicaid, Medicare, or an employer plan, unless you are eligible for Medicaid, Medicare, or an employer plan, then you will only be eligible for 2021 subsidies if you are in receipt of unemployment benefits, regardless of your total actual earnings for the year.)

In most states, the ACA's upgrade to Medicaid eligibility provides coverage for adults with household incomes up to 138% of the poverty line, with eligibility based on current monthly income. So if your income suddenly dropped to $ 0, you are likely eligible for Medicaid and could switch to Medicaid when your job-related coverage ends.

Unfortunately, there are still 11 states where most adults face a coverage gap when their household income is below the federal poverty line. They are not eligible for premium subsidies in the market (unless they received unemployment benefits in 2021 and thus can qualify for the 2021 subsidies).

This is an unfortunate situation that these 11 states have created for their low-income residents. However, there are strategies to avoid the coverage gap when you are in one of these states.

And remember that eligibility in the marketplace depends on your household income for the whole year, even if your current monthly income is below the poverty line. So if you earned enough earlier in the year to be eligible for 2021, you can sign up for a plan with grants based on that income, although you may not earn anything for the rest of the year.

If open enrollment starts in November, you will need to extrapolate your income for 2022 as accurately as possible if you still need to purchase your own insurance cover for 2022. For the remainder of 2021, however, you can use the income you have already earned this year to receive funding.

What if i'm eligible for Medicare soon?

Recently, the number of people who retire in their late 50s or early 60s before they are eligible for Medicare has increased. The Court of Auditors has made this more realistic from 2014 through premium subsidies and the elimination of health insurance.

And the ARP has increased the subsidies and made them more widely available for 2021 and 2022, so that early retirees make affordable insurance more accessible. This is especially true for those whose early retirement income they may not have taken advantage of in the year of their retirement due to the “subsidy cliff” (which the ARP will remove by the end of 2022).

So if you are about to lose or quit your job and have a few months or years until you are 65 and eligible for Medicare, rest assured that you will not have to go uninsured.

You can sign up for a Marketplace plan during your special sign up period triggered by the loss of your employer sponsored plan. And even if you had a relatively solid income early in the year, you may still be eligible for premium grants to offset some of the cost of your new plan for the remainder of 2021.

You can then update your projected earnings for 2022 during the upcoming open enrollment period. Your subsidies will be adjusted in January based on your income in 2022.

And Marketplace plans are always bought month-to-month, so if you eventually switch to Medicare, you can cancel your coverage no matter when.

Don't worry, take cover

The short story for all of this? There is insurance coverage, and getting your own health insurance plan isn't as complicated as it might seem, even if you've had employer-funded insurance all your life.

You can enroll outside of open enrollment if you lose your job-related insurance, and there is a good chance you will qualify for financial assistance that will make your new plan affordable.

You can learn more about the marketplace in your state and the tariff options available by selecting your state on this map. And there are free registration wizards – navigators and brokers – across the country to help you understand everything.

Louise Norris is an individual health insurance broker who has been writing about health insurance and healthcare reform since 2006. She has authored dozens of opinions and educational papers on the Affordable Care Act for healthinsurance.org. Your state health exchange is regularly quoted by the media reporting on health reforms and by other health insurance experts.

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