Thursday, August 4, 2022

What Insurance Is Available For The Unemployed

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Who Should Consider Short

Health insurance options for recently unemployed

Temporary medical insurance is ideal for people who:

  • Need affordable health insurance for a short period of time.
  • Need temporary health insurance for unemployed periods of time.
  • Need to buy health insurance when leaving one job and starting a new one.
  • Are seasonal employees who need temporary health insurance.
  • Are college students who aged out of a parents policy.
  • Retired early and need coverage until their Medicare benefits begin.
  • Missed the Open Enrollment Period and dont qualify for a Special Enrollment Period .
  • Cannot afford, or do not want to purchase, COBRA insurance
  • How Do I Apply

    To receive unemployment insurance benefits, you need to file a claim with the unemployment insurance program in the state where you worked. Depending on the state, claims may be filed in person, by telephone, or online.

    • You should contact your state’s unemployment insurance program as soon as possible after becoming unemployed.
    • Generally, you should file your claim with the state where you worked. If you worked in a state other than the one where you now live or if you worked in multiple states, the state unemployment insurance agency where you now live can provide information about how to file your claim with other states.
    • When you file a claim, you will be asked for certain information, such as addresses and dates of your former employment. To make sure your claim is not delayed, be sure to give complete and correct information.
    • It generally takes two to three weeks after you file your claim to receive your first benefit check.

    When Should You Use Cobra

    COBRA is usually not the most cost-effective way to get health insurance. We recommend that you only use it for a few months or in the following situations:

    • Stopgap to continue coverage while waiting for another policy to begin.
    • To keep using a plan’s benefits when you’re receiving ongoing health care and you’ve already met the plan’s deductible or out-of-pocket maximum. In this situation, the higher monthly costs of a COBRA plan are offset by lower medical costs because the plan details carry forward when it switches from employer coverage to COBRA.

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    Should You Ever Go Without Health Insurance

    The federal fine for not having health insurance is no longer in place, although some states have their own penalties. Should you take the risk and make do without health insurance?

    A fine will be the least you have to worry about if you break your arm, get appendicitis or have a heart attack and donât have health insurance. The average hospital admission in the U.S. cost over $24,680 in 2018, according to KFF.org the average admission for surgery cost $47,345. Perhaps itâs not surprising that medical costs are a leading cause of U.S. personal bankruptcies. Purchasing at least minimal coverage can help provide peace of mind, knowing that youâre covered if a costly illness or accident occurs while youâre in between jobs.

    Overview: Unemployed? Here are 3 things you could do when your COBRAs premium health insurance ends Sept. 30

    • Switch to an Affordable Care Act policy once your free coverage ends

    • Qualify for a special enrollment period

    • Talk to your plan administrator and/or former employer

    When Sept. 30 rolls around, itll be goodbye to that premium health coverage from COBRA and hello to many, many questions . But well start by saying you shouldnt panic there are options that unemployed individuals could and should begin to consider now.

    Health Insurance For Unemployed Americans: All Your Options

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    Losing a job is one of the most disappointing things that can happen in life. Not only do you lose your ability to pay your bills, but you also lose access to previous employment benefits such as health insurance.

    If you dont have a reliable source of income, what should you do to make sure youre still covered for your health care needs? Thankfully, there are plenty of alternatives for health insurance for unemployed people. Lets explore your options so you can get through unemployment while still having your health needs met.

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    Tips If Youre Unemployed And Need Health Care

    It might be impossible to predict when your job could be coming to an end, but there are things you can do to keep yourself ahead of the game and have a backup plan if you suddenly find yourself out of work and out of health insurance.

    1. Start to find new coverage as soon as possible.

    Even before you leave a job, theres nothing wrong with talking to those helpful folks in Human Resources about your health insurance benefits and what will happen to them if you leave. Youll be able to find out how much COBRA coverage will cost you and use this info to decide whether to stick with COBRA or go it alone in the health insurance marketplace.

    2. Have all your important details ready.

    When youre all set to talk COBRA or marketplace or even Medicaid, heres the information you should have ready: your income, total household income, Social Security number, pay stubs, tax records, information about your current health insurance plan, and the number of dependents in your household.

    3. Get advice from an independent insurance agent.

    4. Keep your emergency fund full.

    An emergency fund is a must no matter what your situation is in life! But its super important if youre out of work and out of health insurance coverage. Your emergency fund takes away the worry of those unpredictable trips to the doctor and routine checkups that come with out-of-pocket costs. Having a fully funded emergency fund will give you the ability to pay for insurance during a gap period without all the stress.

    How Do You Get Health Insurance With No Job Or No Income

    For most people who are unemployed, we recommend applying for health insurance on HealthCare.gov.

    This portal will tell you if you qualify for programs like Medicaid, the Children’s Health Insurance Program or discounts on marketplace plans. Each state is slightly different in its qualification criteria and process. However, starting from HealthCare.gov will help guide you to the programs and resources that are relevant for you.

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    When Can You Get Coverage

    Losing health insurance coverage automatically triggers a 30-day special enrollment period , making it possible to update who is covered by a health insurance plan. This is shorter than the 60-day SEP that’s available on the ACA marketplace. However, all employers must offer special enrollment because of the Health Insurance Portability and Accountability Act of 1996 .

    When you join an employer or group plan, your health insurance coverage will begin on the first of the month after your enrollment.

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    Life happens. We get that.If you lost your job, we know youre not just worried about when your next paycheck will arrive, theres also that other nagging thought in the back of your mind: What about my health insurance?

    If youre no longer covered by your employers group health insurance, you might be assuming that your health care options are limited. And now it may feel like all you can think about is how to get health insurance between jobs.

    But dont lose hope. Take a deep breath. There are options out there to protect your health care until youre back on your feet!

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    Can You Decline Employer Health Insurance

    Employees may decline health insurance offered by employers. This is called a waiver of coverage. Unless the employee signs a waiver stating that they are covered under another plan, such as a spouses plan, Medicaid, or Medicare, the employee cannot enroll in your plan until the next open enrollment.

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    If Youve Exhausted Your Employment Insurance Benefits

    If youve exhausted your Employment Insurance benefits and are no longer eligible for EI, you may be eligible for the Canada Recovery Benefit if you meet the eligibility criteria . However, if you worked while on your EI claim, you may be able to establish a new EI claim. To determine your EI eligibility, you should make an EI claim before applying for the CRB .

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    Best Health Insurance Options For The Unemployed

    Nearly half of Americans get health insurance through a job, but for everyone else, there are options. From Medicaid to the Marketplace, if youre worried about how to find health insurance without a job, rest assured there are relatively affordable plans available.

    MoneyGeek has identified the best Marketplace policies to help you understand your options.

  • Best Health Insurance For The Unemployed
  • If youre unemployed and uninsured, you still have options. Specifically, Medicaid is the government health insurance program designed for low-income people. Eligibility requirements vary by state, but if you qualify, youll have access to comprehensive health insurance at little or no cost.

    If you dont qualify for Medicaid or another type of insurance, you can still find affordable options on the Marketplace. Government subsidies help make these private health insurance plans more affordable.

    In MoneyGeeks analysis, we identified Kaiser Permanente as the best health insurer for unemployed people available on the Marketplace. For people looking for Catastrophic coverage, we picked Anthem because it has the lowest premiums and above-average quality.

    Key Takeaways

    If youre unemployed, you dont need to and shouldnt go without health insurance. There are many good options: the Health Insurance Marketplace, joining a family members plan or government insurance such as Medicaid or Medicare.

    How To Get On Your Parents Or Spouses Health Insurance Plan

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    If you have a spouse with job-based health insurance, you may be able to join their policy. Adding you to their plan will increase their health insurance costs, but this still may be a cost-effective way to get robust health insurance.

    People under age 26 can also stay on or join their parents’ private health insurance plan, thanks to the ACA. It will add costs for your parents but it may be well worth it to get good coverage for you.

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    What Is The Cheapest Health Insurance

    Short-term and catastrophic coverage plans are usually the cheapest health insurance options for anyone who recently has lost their job. However, there are downsides to both. Short-term coverage lasts only for up to one year and is banned or restricted in some states. Youll need to be younger than 30 years old or meet low-income requirements to qualify for catastrophic coverage, and even if you do, those low premiums come at the expense of high deductibles.

    Will My Premium Really Be Free

    For many eligible Americans, yes.

    Whether or not you get a $0 plan will depend on the advanced tax credits that you qualify for during the application process.

    The CMS says that an average of three out of five eligible, uninsured Americans will not have to pay a premium with four out of five qualifying for a plan that is $10 a month or less.

    We encourage consumers who have received unemployment compensation in 2021 to visit the Marketplace to see if they qualify to save money on their health insurance premiums and out-of-pocket costs, Becerra said.

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    Do I Need To File A Tax Return If I Don’t Have Income But I Do Have Healthcare

    If you receive premium tax credits, then you must file tax returns, even if your income level wouldn’t normally require a tax return. In other words, if you don’t pay full price for your healthcare coverage, then you will need to file tax returns regardless of your income. You will know whether you use premium tax credits to pay for healthcare, because you will receive an IRS Form 1094-A.

    Can I Enroll In Self

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    If youre losing your job-based health insurance, you do not have to wait for the fall open enrollment period to sign up for a new ACA-compliant plan.

    Although the COVID-related special enrollment window for individual/family health plans has already ended in most states, youll qualify for your own special enrollment period due to the loss of your employer-sponsored health plan.

    This will allow you to enroll in a plan through the marketplace/exchange and take advantage of the subsidies that are available , without having to wait until 2022 to get coverage.

    If you enroll prior to your coverage loss, your new plan will take effect the first of the month after your old plan ends, which means youll have seamless coverage if your old plan is ending on the last day of the month.

    Your special enrollment period also continues for 60 days after your coverage loss, although youd have a gap in coverage if you wait and enroll after your old plan ends, since your new plan wouldnt take effect retroactively.

    If youre in that situation, you might find that a short-term health plan is a good option for bridging the gap until your new plan takes effect. Short-term plans wont cover pre-existing conditions and are not regulated by the Affordable Care Act . But they can provide fairly good coverage for unexpected medical needs during a temporary window when youd otherwise be uninsured.

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    What Happens To Your Employer

    If you are laid off from your job, your health insurancecoverage typically ends when your job does. Some employers will extend benefitsto the end of the month in which you are laid off, but this varies from companyto company. Under a federal program known as COBRA, you may keep your currentinsurance, but you must pay the full amount of the premiums and any otherexpenses previously covered by your former employer.

    The cost of keeping your current coverage under COBRA can bequite high. Many individuals find it is more cost-effective to enroll in anunemployed health insurance plan that will offer similar coverage for lessmoney in many cases.

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    Requirements For Unemployment Insurance

    An unemployed person must meet two primary requirements to qualify for unemployment insurance benefits. An unemployed individual must meet state-mandated thresholds for either earned wages or time worked in a stated base period. The state must also determine that the eligible person is unemployed through no fault of their own. A person may file an unemployment insurance claim when fulfilling these two requirements.

    Individuals file claims in the state where they work. A participant may file claims by phone or on the state unemployment insurance agency’s website. After the first application, it generally takes two to three weeks for the processing and approval of a claim.

    After approval of a claim, the participant must either file weekly or biweekly reports that test or confirm their employment situation. Reports must be submitted to remain eligible for benefit payments. An unemployed worker cannot refuse work during a week, and on each weekly or biweekly claim, they must report any income that they earned from freelance or consulting gigs.

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    Is There Lost Job Health Insurance

    While theres no specific lost job health insurance, two main coverage options are available for you if youre unemployed:

    • A COBRA plan allows you to extend the health care plan from your previous employer for up to 18 months after you leave a job. The disadvantage to this is COBRA is expensive and you have to pay for it yourself.
    • You can buy a plan yourself through the Health Insurance Marketplace. For up to 60 days after you lose coverage through your job, you qualify for the Special Enrollment Period. During this time you can buy and enroll in a new plan. When applying, youll also find out if you qualify for federal financial assistance, such as tax premium credits or cost sharing reductions.

    Types Of Disability Policies

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    There are two types of disability policies.

    • Short-term policies may pay for up to two years. Most last for a few months to a year.

    • Long-term policies may pay benefits for a few years or until the disability ends.

    Employers who offer coverage may provide short-term coverage, long-term coverage, or both.

    If you plan to buy your own policy, shop around and ask:

    • How long do benefits last?

    • How much money will the policy pay?

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    Q: How Do The New Aca Subsidies For Unemployment Work

    Under the new legislation which went into effect on April 1st, 2021, the ACA Premium Tax Credit is being expanded. One of the primary targets of this expansion is individuals and families who have recently received an unemployment check. This is a group of people who might otherwise fall into the Medicaid Coverage Gap.

    Heres how it works: Anyone who has received unemployment in any week of 2021 will have their counted income capped at 133% FPL. This makes it possible to secure a $0 premium plan on the Marketplace, no matter how much you normally earn.

    Ease Your Health Insurance Worries With Help From An Expert

    Heres the truth: Trying to figure out your health insurance can be really overwhelming, especially if youre unemployed. Why not take the stress out of it and let an independent insurance agent guide you? Having an agent step in to make sense of it all is really helpful.

    Among other details, an independent agent will know your particular states laws vs. federal policies. Even better? Theyll be able to save you money by knowing how and when to apply the perks of the American Rescue Plan.

    Ready for some good advice and peace of mind from trusted insurance experts in your area? Start the process today by talking with an Endorsed Local Provider .

    About the author

    Ramsey Solutions

    Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners.

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