Health Insurance After Job Termination

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If you have been terminated from your job or are concerned that this might happen soon, you may be wondering what to do about health insurance coverage. Fortunately, you do have several options for covering your health care needs.

Planning

  • Before investigating health care options, look at your current or past employer’s plan to understand your current or most recent coverage. Determine if you have been paying for such components as dental and vision coverage. Make note of current deductibles. Find out what your monthly payment is and what you are covered for such as doctor’s visits and prescription drugs. Make a list of your doctors so that you can check that list against the other plans you will be considering.

Health Insurance Portability and Accountability Act (HIPAA)

  • According to the U.S. Department of Labor, HIPAA provides assistance to individuals moving to another job. Regardless of enrollment period (such as a once-a-year open enrollment), an individual can sign up for a plan at any time as long as he signs up within 30 days of losing other coverage.

Spouse's Plan

  • If your spouse works and has health care coverage, extending that coverage may be the least expensive option for you. For most plans, you can immediately be added to the policy with no waiting period. Ask your spouse to check with her employer to find out what extended coverage would cost on a monthly basis.

Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA)

  • Another coverage option, COBRA, permits you to continue the coverage you had with your current employer if you were laid off or retired. If you were terminated for gross misconduct, this does not apply. In addition, to qualify for coverage your employer must have more than 20 employees. The enrollment period for coverage is no more than 60 days after notice that employer coverage has ended. Upon signing up for COBRA, you can be enrolled in a COBRA plan for 18 months. Some states, such as New York, allow extended coverage up to 36 months.

Other Coverage

  • An alternative coverage to a spouse’s plan is to obtain coverage direct from an insurance company. This is often the most expensive type of coverage. One way to reduce this cost is to join an association that offers discounts to its members. For example, some associations cater to the needs of freelancers who can’t access company coverage. If you decide to do freelance work before getting a new job, this is one option you should investigate.

References

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