In the wake of the economic impacts from COVID-19, millions of Americans are finding themselves without work and potentially without much needed health insurance coverage. Life doesn’t take a timeout and people still need medical care. Unfortunately, many individuals are faced with the costs of that care during a time in which their next paycheck may be uncertain.
If you are impacted by a job change or loss and you have lost your health insurance coverage, it’s important to know your options. Here are some helpful tips to navigate this tough time.
COBRA is the same insurance that you had while employed, however, the difference is that your prior employer is no longer paying a portion of the insurance plan’s cost. You can continue COBRA coverage for up to 18 months, and in some cases longer. Your deductible does not restart, you keep access to the same health network, and you’ll be able to keep your coverage in place without any gaps. You’ll need to apply for COBRA within 60 days of your job or coverage loss so keep track of key dates as you consider your options.
According to Kaiser Family Foundation, however, most people forego COBRA coverage due to the higher cost however, if you have a Health Savings Account with available funds, those dollars can be used to pay for COBRA premiums.
Health Insurance Marketplace
Job loss or loss of employer provided health insurance is considered a qualifying event for a special enrollment period which would make you eligible to buy a new health insurance plan through the federal or state- health insurance marketplace. Plans offered through the marketplace are considered qualified plans in that they offer coverage for the ten essential benefits mandated by the Affordable Care Act, such as prescription drugs, pediatric services, emergency and hospitalization services.
Depending on your financial situation, expected income and sources, you may be eligible for federal or state subsidies which can reduce your health insurance premiums. In addition, if you are receiving unemployment compensation, you may use any available Health Savings Account funds you have to pay for your health insurance premiums. Plan availability may vary depending on where you live and providers that participate in your state. Visit usaa.com/healthsolutions or www.healthcare.gov for more information, plan types and pricing.
Short-Term Health Plans
Short-term health plans have been made more accessible than in the past. Regulations which went into effect in 2018, increased the length of time that a short-term health plan can last and expanded consumer options to renew plans that had been enrolled in previously. Short-term health plans can be acquired via a private health insurer or by speaking with an insurance broker and can last for up to 364 days (some plans may have renewal options for up to 36 months).
However, it is important to understand what a short-term health plan covers and more so what is excluded. Short-term plans often exclude coverage for pre-existing conditions. If you were receiving ongoing medical care during your employment or on your prior plan, carefully consider if a short-term health plan will provide the coverage that your personal situation may require.
If you decide to stay out of the workforce, but you’re under 65 years old, you won’t be eligible for Medicare unless you have an eligible disability. You can find more information on Medicare eligibility at www.medicare.gov.
Medicaid/State Provided Coverage Options
Programs are in place for individuals needing medical insurance coverage but do not have the means to be able to afford it. The Medicaid program offer free or low-cost comprehensive coverage for those who have low to no income. If you have recently lost your job or have had impacts to your income, Medicaid may be a viable option for you.
According to Kaiser Family Foundation, states may offer free Medicaid coverage for COVID-19 testing to all uninsured residents. Coverage eligibility limits are less strict for children and pregnant women however eligibility limits can vary state by state and are usually based off your income as a percentage of the Federal Poverty Level (FPL). You can learn more about coverage and eligibility for Medicaid on www.healthcare.gov or visit your state’s Medicaid website.
Regardless of the path you pick, having a plan in place for your medical care needs is crucial, but so are the steps you take in working with your medical providers. During this unprecedented time, many providers are working with their patients to ensure payment is not a roadblock for someone getting the care they need.
If you are impacted financially, reach out to your medical providers and ask which payment plan options or discount arrangements are available.
USAA is here to help. We offer a number of health products that might be suitable for your family’s needs. For more information on health insurance plans and resources, visit usaa.com/healthsolutions.
This material is for informational purposes and is not investment advice, an indicator of future performance, a solicitation, an offer to buy or sell, or a recommendation for any specific product.
USAA believes the websites and resources used to gather this information are reliable; however, we cannot guarantee the accuracy or timeliness of the information.
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