Health insurance may have once been an optional form of financial protection, but today’s costs make insurance practically mandatory. With the average American spending $10,000 a year on medical expenses, a monthly premium for health insurance is far more affordable than out-of-pocket payments. However, it’s far too easy for a job loss or divorce to leave you with no health insurance and no idea of where to get it. It’s true that there’s an open enrollment period at the end of each year for the following year, but you’re not out of luck just because you happen to lose your coverage at the wrong time. One of the major parts of the last health care reform bill established pathways to getting insurance regardless of when or why you need it. The path to finding affordable health insurance as soon as possible requires different actions depending on why you lost your former coverage. Determine the cause, and then take the following actions at your earliest convenience to avoid a costly gap in coverage.
Lost Due to Losing Your Job
Loss of a job that offers health insurance as a benefit is the single most common reason people find themselves with an interruption in coverage. Even if you know you’re going to be laid off, it’s easy to forget about insurance while you’re dealing with other more pressing issues. Most people in this situation need short term health insurance to bridge the gap until they find another position with its own benefits package. Each employer follows the enrollment process as well, so getting a job outside of the enrollment period for health insurance means you may have to wait up to a year before your new employer’s policy covers you.
Regardless of whether you are fired, laid off, or quit voluntarily, your last day of employment is also the last date of your health insurance coverage through that employer unless your employer has a contract stating otherwise. Even if you paid a month’s premium just the day before, this may leave you immediately without coverage in the case of on-the-spot firing. All employees who previously had an employer’s insurance can sign up for COBRA coverage. This is a federally operated program to continue coverage seamlessly until you can find your own policy or another job. However, you are responsible for paying the entire premium yourself with this coverage. You can stay on COBRA for up to 18 months to give yourself time to find a self-paid plan through the health marketplace or for your new benefits to kick in.
Lost Due to Divorce
The end of a relationship also means the end of insurance coverage if you were on a spouse’s plan. You’re entitled to keep any policies held separately in your name, but joint insurance is legally mandated to be dissolved after a divorce. Even if you stay friends with your ex-spouse, they can’t legally have you on their insurance policies any longer.
COBRA comes to the rescue again in these situations. If you wish to stay on the same policy, you can pay for it through COBRA for up to 36 months. You can also talk to your employer about transitioning onto their plan if you previously turned it down, or enroll through the marketplace. Divorce is one of the many major life changes that qualify you to use the marketplace outside of the usual enrollment period, so take advantage of that allowance to shop around.
Lost Due to Cancellation
It’s very rare, but sometimes insurance companies cancel their services to an entire state. This is known as cancellation and it has to come at the end of a 12 month agreement after a 90 day written notice. The insurance company must offer to sign you up for any of their other plans offered in your state, and you also have the right to check the marketplace for new policies from any insurer at that time. Very few people experience this kind of cancellation, but it is expected to increase in the next few years due to uncertainties in health insurance regulations.
Online insurance shopping is great, but it doesn’t compare to working with an experienced insurance broker. We can help you with both types of insurance shopping here at Freeway Insurance. Contact Freeway Insurance by dialing 800-777-5620 to compare insurance rates and get more information.