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What are Your Health Insurance Options if You Are Unemployed Due to Covid-19?

If you are unemployed or between jobs because of COVID-19 (coronavirus), you are not just worried about when your next paycheck will arrive; there is also that other thought in the back of your mind: What about my health insurance?

It’s easy to feel lost at sea if you are out of work and no longer covered by your employer’s group health insurance—particularly if you have a family dependent on your coverage too.

But do not lose hope. There are choices out there to cover your health care until you are back on your feet!

Health Care Choices for the Unemployed During COVID-19

We won’t sugarcoat it—being without health coverage is never a good feeling, particularly not in a pandemic. But whether you have health insurance or not, remember that testing for COVID-19 is available for free. Whether you have been out of work for a while or are one of the 6.6 million Americans who just filed for unemployment because of the coronavirus pandemic, the good news is you have health insurance options!

Health Care if You Have Just Lost Your Work

Life happens. And if you find yourself out of employment that gave you employer-based health care, these are your main options for coverage:

• The private health insurance marketplace
• Government health insurance marketplace
• COBRA

Consolidated Omnibus Budget Reconciliation Act (COBRA)

Yeah, that’s a mouthful. No wonder we all simply call it COBRA. To put it simply, COBRA lets you carry on your employer-based coverage for a limited period after you have stopped working for them. Big sigh of relief, correct? Here are some of the pros and cons:

Pros of COBRA

The good thing regarding COBRA is that it makes it mandatory under federal law for an employer to allow employees to pay to stay on their health care 18 months after they have left their job. This can also stretch to 36 months if you are eligible.

Cons of COBRA

The disadvantage of COBRA is that you will pay the full cost of the health insurance premium yourself. You will pay more than what you saw coming out of your paycheck when you were employed since your employer was subsidizing (aka paying for!) some of that health care premium.

Now, if this is going to break the bank, don’t worry! You can enter the general health insurance marketplace instead. But it is always a good idea to talk to your employer before or as soon as you leave to get the lowdown on what your new COBRA premium might be. That way, you have all your bases insured.

High-Deductible Private Health Insurance

If you do not want to extend your employer’s coverage, you could move directly into the private health insurance market to cover you and your family. And it makes even more sense if you also have a Health Savings Account (HSA) since that HSA is there to help with out-of-pocket costs!

With an HSA, you will be required to enroll in a plan with a high deductible, and that’s good for you since it means low monthly premiums. This is really important if you are not sure when your next job (and paycheck) might come along.

Marketplace Health Insurance

Losing your job is tough in so many ways, particularly if it all went down suddenly, thanks to the coronavirus. Losing your employment at any time is a major life event. But whatever the reason you find yourself out of work, you can move straight to purchasing a health insurance plan in the government health care marketplace.

Resources and References:

• Health Savings Account
• Consolidated Omnibus Budget Reconciliation Act