Health Insurance: High Costs And Life Changes

A qualifying life event is a major change in your life situation that can make you eligible for a Special Enrollment Period, allowing you to enroll in health insurance outside the yearly Open Enrollment Period. While losing health insurance is a qualifying life event, having high health insurance does not count as a life-changing event. However, changes in income that affect the coverage you qualify for can be considered a qualifying life event.

Losing health insurance due to job loss

Losing your job and your health insurance can be a stressful and challenging experience. However, it is important to know that you have options to ensure you remain covered. Here are some detailed instructions on what to do if you lose your health insurance due to job loss:

Understanding Qualifying Life Events (QLE)

Firstly, it is essential to understand that losing your health insurance due to job loss is considered a "qualifying life event" (QLE). A QLE is a significant change in your life situation that impacts your current health insurance coverage and allows you to make changes outside of the usual yearly Open Enrollment Period. Losing your job and employer-sponsored insurance is a type of QLE that makes you eligible for a Special Enrollment Period (SEP).

Special Enrollment Period (SEP)

During the SEP, you can purchase health insurance or make changes to your existing plan. You typically have 60 days before or after a QLE to apply for a new plan or change your current one. It is recommended to contact your insurer or the Marketplace as soon as possible to avoid any gaps in coverage.

Options for Health Coverage after Job Loss

When it comes to health coverage options after losing your job, you have a few choices:

• Enroll in a Marketplace plan: You can explore the Health Insurance Marketplace to find a plan that suits your needs. You may qualify for cost savings or subsidies based on your income and household size. The Marketplace offers a range of plans, including Bronze, Silver, Gold, and Platinum, each with different premium and out-of-pocket cost structures.
• Sign up for COBRA coverage: COBRA (Consolidated Omnibus Budget Reconciliation Act) allows you to maintain your job-based health insurance temporarily, usually for up to 18 months. However, you will be responsible for paying the full premium yourself, plus a small administrative fee.
• Spouse's Health Plan: If you have a spouse who has health insurance, you can consider getting added to their plan. This option may be easier than finding a new plan, but it could result in higher premiums for your spouse's coverage.
• Individual Insurance and ACA Exchanges: The Affordable Care Act (ACA) has made it possible for individuals to purchase health insurance directly from the marketplace or insurers. These plans offer ACA protections, including essential health benefits, and you may be eligible for subsidies and tax credits to offset premium costs.
• Short-Term Health Plans: These plans are designed to bridge the gap between jobs and are typically more affordable, but they have limited benefits and higher out-of-pocket costs.
• Medicaid: If you meet the income requirements, you may be eligible for Medicaid, a government-run health insurance program that provides coverage for individuals and families with low incomes, including children, pregnant women, and people with disabilities.

Remember that it is crucial to have new coverage in place before your current health insurance expires to avoid any gaps in your health insurance coverage. Each option has its pros and cons, so be sure to carefully consider your choices and select the one that best suits your needs and financial situation.

Losing eligibility for Medicare, Medicaid or CHIP

Special Enrollment Period

A Special Enrollment Period is a period of time during which you can purchase health insurance outside the yearly Open Enrollment Period. You must have a qualifying life event to qualify for an SEP. Under the guidelines set by the Affordable Care Act (ACA), you can typically make changes to your health insurance plan within 60 days leading up to, or following, a qualifying life event.

If you lose eligibility for Medicare, Medicaid or the Children's Health Insurance Program (CHIP), you can apply for a Marketplace health plan. Most people qualify for savings to lower what they pay for their monthly premium and when they get care. You can apply and enrol in a Marketplace plan as early as 60 days before your coverage ends to avoid a gap in coverage.

Other options

You can also re-apply for Medicaid or CHIP through your state, as you may still qualify. If your employer offers health insurance, you can decide between a job-based plan or Marketplace coverage. If you are 65 or older, you may be able to sign up for Medicare.

Turning 26 and losing parental coverage

Turning 26 and losing parental health insurance coverage is a significant life event that can impact your access to healthcare. Here are some important things to know about this transition:

Understanding the Affordable Care Act (ACA)

The ACA, also known as "Obamacare," includes a provision that allows young adults to remain on their parent's health insurance plan until they turn 26. This has enabled millions of individuals in their early adulthood to maintain health coverage. However, once you have your 26th birthday, your insurance options will change, and you will need to explore alternative coverage options.

Timeline for Losing Parental Coverage

The timing of when you lose parental coverage depends on the type of insurance plan. If you are covered under your parent's employer-sponsored insurance, your coverage will typically end before your 26th birthday, either at the end of the month of your birthday or the day before you turn 26. On the other hand, if your parents have an ACA marketplace plan, you can usually remain covered through December 31 of the year you turn 26, even if you reach that age earlier in the year.

Special Enrollment Period

Losing parental health coverage when you turn 26 qualifies you for a Special Enrollment Period (SEP). This period allows you to enroll in a new health insurance plan outside of the standard yearly Open Enrollment Period. The SEP typically starts 60 days before your coverage ends and lasts 60 days afterward, giving you a total of 120 days to find alternative coverage. It is important to enroll in a new plan early to ensure there is no gap in your health insurance coverage.

Extended Coverage in Certain States

While most states adhere to the age 26 cutoff for parental health insurance, there are a few exceptions. Eight states, including Florida, Illinois, Nebraska, New Jersey, New York, Pennsylvania, South Dakota, and Wisconsin, allow young adults to remain on their parents' health insurance plans beyond the age of 26. Each state has its own eligibility requirements, such as age limits and conditions regarding marital status, residency, student status, and other insurance options.

Options for Alternative Coverage

When transitioning off your parents' health insurance plan, you have several options for alternative coverage:

• Employer-sponsored health insurance: If you are employed, obtaining health insurance through your job is often the most convenient and cost-effective option. Employer-sponsored plans usually have excellent benefits, and your employer typically covers a large portion of the cost.
• Spouse's health plan: If you are married or plan to get married, you can be added to your spouse's health plan. While this option may increase premiums, it can still be more affordable than individual plans.
• Consolidated Omnibus Budget Reconciliation Act (COBRA): COBRA allows you to stay on your parents' health insurance plan for a limited time after aging out. However, it can be expensive, as you have to pay the full cost of the plan plus an administrative fee.
• Individual health plan: You can purchase an individual plan through the ACA health insurance marketplace. Depending on your income, you may be eligible for subsidies or tax credits to make this option more affordable.
• Catastrophic health plan: If you are under 30 or facing specific hardships, you may consider a catastrophic health plan, which offers comprehensive benefits at lower premiums but with higher out-of-pocket costs.
• Short-term health plan: Short-term health insurance provides temporary coverage for up to a year, with the option to renew for two additional years. However, it may have limited benefits and higher out-of-pocket expenses.
• Student health plan: If you are a college student between the ages of 17 and 29, you can purchase a student health plan that travels with you regardless of where you study in the country.
• College or university health plan: If you are a full-time student, you may have access to a school-sponsored health insurance plan, which can be especially useful if you are studying out of state.
• Medicaid: If you have a low income, you may qualify for Medicaid, which offers free or inexpensive health insurance with comprehensive benefits.

Having a baby or adopting a child

Special Enrollment Period

During the SEP, you are allowed to make changes to your health care plan outside the Open Enrollment Period (OEP). The SEP was originally established in 2016 by President Barack Obama and was accelerated during the COVID-19 pandemic. It remains an option for the public even after the pandemic.

Time Frame

The SEP typically lasts 60 days, beginning on the day of your child's birth or the day of adoption/placement. You will need to provide documentation, such as a birth certificate or adoption papers, to qualify. Your coverage will generally start the month immediately following your decision, though it can also begin on the first date of the following month if that is your preference.

Adding Your Child to Your Plan

If you are already enrolled in a plan, you can add your child to your existing plan, ensuring they are covered at the same metal level. Alternatively, you can enroll your child in a new plan at any metal level.

It is important to note that there may be restrictions for parents with existing plans that could prevent them from changing the metal level of their plan. Therefore, it is recommended to consult with a health plan expert to ensure you have the most up-to-date information.

Moving to a different zip code or state

To qualify for special enrollment due to moving, your move must typically meet certain criteria. Firstly, if you are moving to a different state, you will likely be eligible for a special enrollment period to enroll in a new health plan. This is because your previous health insurance options may not be available in your new state. Secondly, if you are moving within the same state, you may still qualify for special enrollment if at least one health plan is available in your new area that was not available at your previous residence. This indicates that the health insurance options in your new zip code are different from your previous options, thus necessitating a change in coverage.

It is important to note that there are time restrictions for enrolling in a new health plan after a qualifying life event. Typically, you have 60 days before or after the life event to make changes to your health insurance plan. This means that you should contact your insurer or the health insurance marketplace as soon as possible to understand your coverage options and avoid any gaps in coverage. Additionally, you may be required to provide documentation to prove that you have moved and qualify for the special enrollment period. This could include documents such as a change of address confirmation, a new driver's license or identification card with your new address, or a signed rental agreement or pay stub with your new address.

If you do not meet the qualifications for a special enrollment period due to moving, there are still options available for health insurance coverage. For example, you may be eligible to enroll in Medicaid, which is a government-run health insurance program that provides coverage based on income levels and other criteria. Medicaid does not restrict enrollment to specific periods of the year, so you can apply at any time to see if you qualify. Alternatively, you could consider short-term health insurance, which offers temporary coverage during periods when you are between traditional health insurance plans. However, short-term health insurance typically has limited benefits and higher out-of-pocket costs.

Frequently asked questions