If you’ve lost job-based health insurance, you have two primary options to get health insurance coverage: buy a health insurance plan through the Health Insurance Marketplace or sign up for COBRA coverage.
Marketplace Plans
To buy a marketplace plan, start by filling out an application at Healthcare.gov. The application will use your income to determine if you qualify for any savings on the monthly premiums or out-of-pocket costs. If your income is low enough, you may be eligible for Medicaid or CHIP, which provides free or low-cost health insurance.
Medicaid and CHIP are available based on income to families, pregnant women, people with disabilities, and elderly individuals. Some states have expanded programs that offer coverage to all residents beneath a certain income level. You can find out if you qualify by answering a few quick questions about your household size, state of residence, and income at Healthcare.gov. Answering qualifying questions is not the same as applying. To apply, you’ll need to create an account at Heatlhcare.gov or apply through your state’s Medicaid agency.
Even if you don’t qualify for Medicaid or CHIP, it’s worth applying because you may qualify for lower-cost coverage through your state’s program. You can apply for Medicaid or a Marketplace plan any time of year.
Note that your state may have a different name for its Medicaid and CHIP programs. You can determine what the programs are called in your state here.
COBRA
Another health insurance option if you have recently lost employer health coverage is Continuation of Health Coverage, commonly known as COBRA. Under COBRA, you can extend workplace health benefits for a limited time. COBRA usually lasts up to 18 or 36 months, depending on your circumstances, Dr. Miller says.
The upside to COBRA is that you get the same coverage you had with your employer, so you can continue using the same doctors and hospitals you went to while employed. The downside is you may be required to pay the full premium or up to 102% of the plan’s cost.
“This may make sense if someone has already incurred a lot of health care expenses in the year and run into their annual “out-of-pocket” (OOP) maximum since if they start a new insurance plan mid-year, they would have restart paying a deductible and would have no costs that would count toward the new OOP amount,” Dr. Miller says.
You’ll generally need to have been insured with an employer who had 20 or more employees to be eligible for COBRA.
Choosing a Marketplace Plan
Within the marketplace, you can choose different types of health insurance plans designated as bronze, silver, gold, and platinum based on the level of coverage:
- Bronze plans offer the lowest monthly premium but highest costs when you need care, with deductibles that can be thousands of dollars per year. These are best for low-cost coverage against worst-case medical scenarios.
- Silver plans offer more moderately priced premiums and costs when you need care with deductibles lower than Bronze plans. Silver plans are best if you qualify for a cost-sharing reduction or are willing to pay a slightly higher premium in return for lower costs when you receive care.
- Gold plans have higher monthly premiums than either silver or bronze plans but provide more help paying for the care you receive with fairly low deductibles. If you receive a lot of medical care, these can be good options.
- Platinum plans carry the highest monthly premium and provide the lowest costs when you receive care with very low deductibles so your plan starts paying earlier than other categories of plans. If you receive a lot of medical care and don’t mind paying a high monthly premium to have almost all of your other costs covered, platinum plans may be a good option.
You may have access to “catastrophic” plans with low monthly premiums, but very high deductibles and are designed to protect you from worst-case scenarios.
To learn how to calculate your total costs of care and help choose between plan types, visit Healthcare.gov.
You will also need to choose between exclusive provider organization (EPO) plans, health maintenance organization (HMO) plans, point of service (POS) plans, and preferred provider organization (PPO) plans within the metal categories. Depending on your location, you may have access to plans of each type within each metal category or only a few. Here is an overview of these plan types:
- EPO plans are managed care plans where your treatment is only covered at in-network providers, except for emergencies.
- HMO plans usually only provide coverage at in-network providers except in an emergency and may also require you to live or work in its service area to receive coverage. These plans often emphasize preventative and wellness care.
- POS plans let you pay less for care received from in-network providers and require you to have a primary care provider who gives you referrals to see specialists.
- PPO plans also let you pay less for care received from in-network providers, but you can see out-of-network providers without a referral if you’re willing to pay more for the care.
The Centers for Medicare & Medicaid Services (CMS) provides a PDF with more details on these plan types to help you choose the best plan for you.
There’s nothing fun about losing your job. On top of that loss, you’re probably also wondering where to get health insurance now.
If you’re thinking, I need health insurance, but my group coverage is gone, don’t panic. Sure, trying to figure out how to get health insurance without a job can be a challenge, but we’ve got good news! You can still get health insurance while unemployed. We’ll walk you through your options.
Healthcare for the Unemployed
We won’t sugarcoat it—being without health insurance is never a good feeling. Even with a job, navigating health insurance can be like paddling upstream in a canoe with a hole in it. While it’s raining. Not easy. If you need help figuring out how health insurance works (don’t we all?), check out this easy-to-understand guide.
Okay—if you’ve lost your job, you won’t be able to get group health insurance through your employer anymore. But you do have these seven options:
1. Short-Term Health Insurance
Short-term health insurance (also called temporary or limited-term health insurance) usually lasts 30 to 90 days and is designed to cover health emergencies and lapses in coverage for a short period. It ain’t perfect, but it can do wonders if you’re facing a sudden job change.
For instance, let’s say you’ve added your name to the Great Resignation and aren’t starting a new job for a few months. Or maybe you retired early and need coverage until you’re old enough to qualify for Medicare. Short-term health insurance might be your best bet.
Here are a couple things to know about short-term health insurance policies:
- They won’t cover everything: These policies won’t give you the same coverage as a traditional medical insurance policy. Don’t expect coverage for stuff like maternity care, mental health services, preventative care or preexisting conditions. On the other hand, they will cover some inpatient/outpatient procedures, emergency room visits and intensive care costs. That’s nothing to sneeze at!
- They can be more expensive: Short-term policy deductibles and out-of-pocket expenses tend to be higher than traditional plans. But remember, the operative word here is temporary. The silver lining is that premiums are usually affordable and coverage can potentially start within 24 hours.
2. Consolidated Omnibus Budget Reconciliation Act (COBRA)
Yeah, that’s a mouthful. No wonder we just call it COBRA. With COBRA insurance, you can extend your employer-based coverage for a limited period of time after you’ve left your job. Big sigh of relief, right?
But before you fully exhale, take a look at the pros and cons:
COBRA Pro: Under federal law, employers must allow employees to keep their healthcare plan for 18 months after they’ve left their job. (This can sometimes stretch to 36 months if you qualify.)1
COBRA Con: You’ll pay the full cost of your health insurance premium yourself. Your employer won’t be pitching in anymore. Based on that math, it’ll be more expensive. Talk to your employer when you leave to find out what your new COBRA premium will be.
And if those high COBRA premiums are squeezing your budget too tight, you can always check out the government’s health insurance marketplace...
3. Marketplace Health Insurance
Good news! If you just lost your job or left your employer for any reason, you can get coverage on the government-run healthcare marketplace. That’s a big deal if your family is depending on that healthcare! You’ll just need to apply within 60 days after you lose your employer’s coverage.
Here are a couple of tips for getting marketplace health insurance:
- Look for subsidies that can help with the rising costs of health insurance. You might qualify for tax credits through Medicaid and/or the Children’s Health Insurance Program (CHIP).
- Look into a high-deductible plan if you and your family are healthy and don’t go to the doctor very often. Your monthly premiums will be lower, and you’ll qualify to start a Health Savings Account (HSA).
4. Medicaid and/or CHIP
Medicaid gives aid to people with disabilities, the elderly, pregnant women, children, and families on low incomes. It currently covers over 80 million Americans and is available in all states to those who qualify.2
If you do qualify for Medicaid, it can reduce your monthly premiums and certain costs like copayments, deductibles and out-of-pocket bills. Medicaid eligibility is based on your income and the size of your household—not your job situation.
How Low Does Income Need to Be to Qualify for Medicaid?
Now you might be wondering, Can I get free health insurance without a job? The answer is that Medicaid is usually free. Although states can charge you a share of the cost, in most cases, you won’t have to pay anything.
Next you might wonder, How low does my income have to be to qualify? Medicaid income levels are based on the government’s federal poverty level (FPL). Check out this resource at HealthCare.gov to see how you stack up.
What if your household income is too high to get Medicaid but too low to afford decent private insurance? Your children might still qualify for a Medicaid program called CHIP (yeah, we mentioned it above). Another plus? Enrollment for CHIP is open year-round.
5. Medicare
Medicare and Medicaid sound the same, but they’re very different. Medicare is healthcare coverage for people over the age of 65. It’s also available to people under 65 who have received Social Security disability benefits for more than two years.3
Medicare also covers those suffering from kidney failure and ALS or Lou Gehrig's disease.4,5
If you qualify for Medicare, your coverage will be split into Part A (hospital costs) and Part B (medical costs), along with Part D (prescription drugs). And just to make things more confusing, there’s Medicare Advantage (known as Part C), which bundles them all together. Go to Medicare.gov to see if you qualify.
6. Private Individual Plan
You can also buy health insurance plans directly through health insurance companies or by working with an independent insurance agent. The coverage might not be as good as policies on the Affordable Care Act (ACA) marketplace, but at least you’ll have something in case of emergencies.
7. Healthcare Cost Sharing
One option rising in popularity is healthcare cost-sharing programs. These work pretty much like health insurance, with monthly premiums and defined coverage terms. The difference is that instead of having an insurance company pay your medical bills, other participants send you the money you need when you use medical services. We’ll talk more about this awesome option below. (Hint: We have a RamseyTrusted partner for this we highly recommend!)
8. Spouse’s or Parents’ Health Insurance Plan
We saved this option for last. That’s because going on your spouse’s plan isn’t the most cost-effective option in normal circumstances. But if you’re unemployed and married—and your spouse has health insurance through their employer—you can usually be included on their policy. After all, isn’t marriage about helping each other out?
You youngsters have another option! If you’re under 26 years old, you can also consider going back on your parents’ insurance policy.6 You might not want to, but it could be the right move for a season.
Now that we’ve seen your options, let’s check out how to get health insurance without a job.
1. Start as soon as possible.
Even before you leave a job, there’s nothing wrong with talking to those helpful folks in HR about your health insurance benefits and what will happen if—or when—you leave. You can find out how much COBRA coverage will cost, then use the info to decide whether to stick with COBRA or go it alone in the marketplace.
2. Gather important details and paperwork.
When you’re all set to talk COBRA, marketplace or even Medicaid, here’s the information you should have ready: your income, total household income, Social Security number, pay stubs, tax records, information about your current (or recently ended) health insurance plan, and the number of dependents in your household.
3. Get advice from an independent insurance agent.
Not only will an independent insurance agent find you the best package for your budget and needs, but they also know the ins and outs of your state’s laws. Some states want you to apply for government-based insurance through the federal marketplace. Others have a state-based marketplace and set their own levels of eligible income. Pretty confusing, huh? That’s why having an agent in your corner helps a lot.
4. Use your emergency fund wisely.
So how much is health insurance without a job? As you can tell from the options above, that answer can vary. But no matter how you decide to get coverage, an emergency fund is always a must! And it’s even more important if you’re out of work and looking for health insurance coverage. Your emergency fund takes away the worry of those out-of-pocket costs that come with unpredictable trips to the doctor and routine checkups. Having a fully funded emergency fund (3–6 months of expenses saved up) will give you the ability to pay for insurance during a gap period without all the stress.
Get Help From an Expert
Here’s the truth: Trying to figure out your health insurance can be really overwhelming. Especially if you’re unemployed. But like we said before, insurance isn’t the only way to get healthcare coverage for the unemployed. And health cost-sharing programs have become a really popular approach we love!
With or without a job, healthcare needs are no sweat with a cost-sharing program. When doctor bills roll in, you submit them to the program administrators to confirm eligibility. From there, you’ll receive payments from other group participants as part of their own monthly premium payments. In the same way, your monthly premiums will be used to cover services billed to other members as needed.
The beauty of healthcare cost sharing is that it lets you participate in a ministry while meeting both your own healthcare needs and those of others. And as a cash-paying patient, you’ll have the option of haggling for lower prices on healthcare services. That’s always a smart move!
Our trusted partner Christian Healthcare Ministries (CHM) can help you figure out your options. They help families share healthcare costs like medical tests, maternity, hospitalization and surgery. Thousands of people in all 50 states have used CHM to cover their healthcare needs, and eligibility has nothing to do with employment status. Plus, they’re RamseyTrusted, so you know they’ll cover the medical bills they’re supposed to and honor your coverage.
Ready to get excellent healthcare coverage in place? Connect with CHM today!