Many Americans receive health insurance through their employers. However, after a job loss, the question of health insurance can be a big one. Fortunately, with the passage of the Affordable Care Act (ACA), also known as ObamaCare, Americans who have lost their jobs have additional options in obtaining health insurance.
Health Insurance Options in the ACA Marketplace
The ACA established health insurance Marketplaces in each state, where insurers offer insurance plans. In general, insurance can only be purchased during an open enrollment period. The next open enrollment period for the Marketplaces is November 15, 2014 – February 15, 2015.
However, when you lose your job and your health insurance, you, and anyone covered under your former employer’s plan, qualify for a special enrollment period. This allows you to purchase new health insurance to replace the lost insurance. You may qualify for tax credits to reduce the premium of insurance purchased through the Marketplace. Eligibility for tax credits is based on income. If you choose to remain uninsured, you will have to pay a tax penalty unless you qualify for an exemption.
In addition, when you apply through the Marketplace you may be found eligible for Medicaid. You can also apply for Medicaid through the state office. This coverage is available year-round – you do not have to wait for an enrollment period to apply.
Health Insurance Options Outside the ACA Marketplace
When you leave your job, you may be offered an extension of your workplace insurance called COBRA. This option is often very expensive, because you will be charged the entire cost of the health coverage plus a 2% administrative fee. This temporary extension will allow you to continue your existing job-based insurance for 18 – 36 months.
If you lose coverage through your job, but your spouse has employer-based insurance, the loss of your insurance coverage will likely trigger a special enrollment period on your spouse’s insurance plan. This will allow you to be added to that plan, if you desire.
Finally, you can use your special enrollment period to purchase private insurance outside the Marketplace. Surprisingly, this is sometimes the most affordable option. Not all insurers offer coverage in the Marketplace, but if you contact them directly you will be able to choose from their available plans and begin coverage. This is a great option if you have a specific insurer you prefer based on their provider network or reputation.
Losing a job and the resulting loss of health insurance can be a difficult experience. However, the ACA has given former employees additional options when it comes to choosing health insurance. Whether you look for coverage inside the Marketplace or outside it, it’s important to understand all the options and make the best choice for yourself and your family.