How to Keep Health Coverage If You Lose Your Job
Someone facing the loss of a job has options to prevent losing coverage along the way. Many workers will qualify for COBRA continuation coverage. Those laid off after September 1 may qualify for a subsidy equal to 65 percent of the costs for up to nine months. People have other options that are outlined in this article.
Dr. Herrick suggests a COBRA extension for laid off workers, get real. If the consumer gets cancer on a short term COBRA they will be in big trouble.
I actually give advise to fired workers about their health insurance options. I tell them to get low cost “Individual Medical” (IM) because there is not a termination date starring them in the face.
America’s first HSA (Formally MSA) was enrolled by Save101.com with TIME Insurance Company. Dr. Herrick’s “A Brief History of Health Savings Accounts,” forgot to mention this. Just think about how fun it would of been, a “Brief History of TIME.”
Don’t take the COBRA because you may get sick.
It’s TIME for your HSA at http://www.save101.com
Ron, Herrick does mention individual purchase as an alternative to COBRA extention.
Devon: Good piece. I hope it gets lots of attention.
Ron, if you switch to non-group coverage for a certain length of time, then get hired and attempt to switch to your new employer’s insurance, you will need to go through a 12-18 month waiting period before any pre-existing conditions will be covered by the new employer’s insurance.
I guess the flip side is, as you say, if you choose to maintain continuous group coverage by using COBRA, and get cancer while on COBRA, you damage your chances of finding individual coverage. But then, wouldn’t the same thing apply to employer coverage in general? If you get cancer while employed, you will similarly be unable to switch to private coverage. By your logic nobody should ever accept employer coverage, period.
Also, if you have a pre-existing condition when you are laid off, COBRA may be your only choice. In California, at least, when COBRA runs out you can apply for HIPAA coverage, but you must exhaust COBRA before doing so.
In any case, not knowing how long the approval process will take or whether you will even be approved, it might be reasonable to go ahead and sign up for COBRA while shopping around for an individual plan.
I think the real culprit here is the damned pre-existing condition firewall between group and non-group plans. If you’re on a group plan and develop a pre-existing condition, you can no longer switch to a private plan. And if you’re on a private plan and develop a serious condition, you can no longer switch period.
Anyway, Devon, thanks for the article. It’s important for individuals to be aware of this stuff. I know from experience that it’s not always safe to trust one’s HR department as a source of information.
I was unaware of the restriction that Bart mentions. If you have individually owned coverage and then you go to work at a place that has an employer plan, why aren’t you entitled to have pre-existing conditions waived under HIPAA?
If someone knows the rationale behind this, or if I was wrong about it, I’d like to know as well.
Just thinking, it’s probably to avoid rewarding people who leave the pool. A low-risk person leaving the group only to return later after becoming high-risk is similar to someone who leaves to become self-insured and then wants back in.
Bart, you are wrong. Individual Medical (IM) is “Creditable Coverage.”
But you are correct that nobody should have employer-based health insurance if they get a head full of brain tumors.
Get permanent HSA individual health insurance on your family so that they are safe. If you have children choose a plan that has a “Dependent Conversion” so when your children are no longer “Full-Time” students they can get new insurance – no questions asked. This is important if you child gets MS like my daughter or Crohns like my son.
TIME is the only company I know of with a “Dependent Conversion.” So TIME is your only choice if you have children. Of course you could just make your child a primary insured and go with any company.
It’s TIME for your HSA at http://www.Save101.com
I guess I stand corrected about IM being creditable. The only exceptions I could find:
1) Individual policies may not be creditable if they only cover specific medical conditions ( http://healthinsurance.about.com/od/glossary/g/creditable.htm ),
2) Certain states do not recognize Certificates of Creditable Coverage from individual health insurance as valid for entry into state-sponsored high risk health insurance pools ( http://www.medsave.com/articles/Understanding-a-certificate-of-creditable-coverage.htm )
I’d be interested in knowing if there are any other exceptions.