Health Insurance: Your options if you’ve been laid off

A quick guide for figuring out your health insurance if you've lost your job or your income.

If you’ve lost employer-provided health insurance, you might have been told you “have COBRA,” or maybe you’ve received texts from your state about ACA open enrollment. What does it all mean?!

The options and the acronyms used in health insurance can be mind-numbing. But, don’t give up! You have a narrow window (~60 days from losing your health insurance) to elect a new plan. We created this mini-guide to lay out your options, and make it easier to find a plan that works for you.

P.S. In case you’re wavering...I just went on this journey, and feel unexpectedly fantastic about having this adult life knowledge.

Here’s how we'll do it:

1. Figure out your medical needs
2. Understand your insurance plan options
3. Go forth and get that plan 💪

Before you dive in...

If you’re not sure how your employment status impacts your health insurance coverage, this article can help, particularly if you've been furloughed. You can also take our quiz!

If you can join a partner's or parent’s plan (i.e. you're under 26 in most states), this could be a much cheaper option. As phones and Netflix have taught us, family plans are 🔥.

1. What are your medical needs?

Let’s start by evaluating your healthcare habit, and what you might need in the coming months.. If you don’t fit neatly into one of these categories, don’t worry! Use them as a starting point.


Frequent/Preventative
  • You’re a preventative healthcare power user, and see a doctor or practitioner at least once a month. This could include PT , therapists, or other providers that you typically use health insurance to cover.
  • You consistently hit your insurance plan’s deductible
Frequent / Preexisting Condition
  • You have a specific medical reason for regularly visiting your doctors, such as a pre-existing condition or you're undergoing treatment, and need to keep your health plan
Basic
  • You visit the doctor only once a year for a check-up and visits when you’re sick or injured
Peace of mind
  • You want coverage that is more than what you typically use 
Family Plan
  • You have several people on a plan, and whose healthcare habits need to be considered as well

2. Cool, now, what are my options?

We'll dive into the three main categories of insurance:

COBRA —  Continuing with your current insurer’s plan; likely most expensive option

ACA Marketplace — Plans made available on your state’s public marketplace; typically more affordable options and you might be eligible for  tax credits/subsidies to cover the costs 

ACA Off Marketplace Buy direct from private insurers; potentially more expensive than what you could find in ACA Marketplace, but if you don't qualify for subsidies,  have specific needs, or you  are looking for more  tailored options, this may be right for you


COBRA

COBRA lets you continue with the same health insurance plan that you had at your job -- only now you’re responsible for the majority if not all of the monthly premium.

It sounds like a no brainer, but your plan will likely be a lot more expensive:

Your new monthly cost =  your employer’s monthly cost  + your monthly cost  +  up to 2% admin fees

Could it be right for me?  

This could be a good option if you’re a power healthcare user  (i.e. you self-describe as a frequent preventative or frequent user with pre-existing conditions and/or you have families with dependents in one of these categories.)

Major Pros: 

  • Maintain the same plan, coverage, and network of providers 
  • It’s an easy, short-term option between jobs
  • You can use your HSA funds to cover premiums (typically cannot do this on ACA)

Major  Cons: 

  • Can result in high premiums/costs
  • Not designed to be a long term solution
  • Not everyone is eligible (companies have to elect) and enrollment windows are short 
Who else could it be good for?

➖You have immediate medical needs (i.e. you’re pregnant or undergoing treatment)

➖You’ve (mostly) paid your deductible/out-of-pocket costs in your annual period (and so most of your medical expenses beyond your monthly premium will be covered)

If you want to know more about COBRA, including how to enroll, check out our guide.


Affordable Care Act (ACA) Plans

What are ACA marketplace plans?

ACA, or Obamacare, plans are insurance places provided by private and government insurers to all citizens, regardless of pre-existing conditions. They  follow certain guidelines, such as the price and minimum care requirements. Plans are sold on either your state or a federal public health exchange -- which is really like cars.com, but for insurance plans.

Could it be right for me?

On-exchange healthcare provides the widest range of healthcare options. If you are a  peace of mind, basic, or family customer we suggest you make this your first stop.  This is also a great place to start  for those that still aren't sure what category they fit in. 

Major Pros: 

  • Tax credits and premium subsidies available for low-income households
  • Extended grace periods for late  monthly payments compared to COBRA 
  • You can not be denied for coverage based on a pre-existing condition 
  • All plans must provide basic healthcare benefits specified by the government  

Major  Cons: 

  • The number of plans offered vary by state, so your options might be limited
  • The insurance provider can chose to stop offering your chosen plan at the end of the year, forcing you to find a new one
  • Plan availability can vary based on your location, especially for folks who have more frequent healthcare needs
Who else could it be good for?

➖If you’re relatively young, healthy and a  “basic” healthcare user

➖Your employer plan becomes unaffordable  (~  > 9.78% of monthly income spent on your plan)

➖You anticipate low income this year ( ~100-400% below poverty line) and think you could qualify for subsidies


Check out our ACA 101 guide for more.


What are the Off Marketplace ACA  plans?

Off-exchange healthcare plans are still ACA compliant, so they still meet the same minimum benefits as on-exchange plans, but they can be purchased at any time and offer additional diversity of plans and prices. One of the main benefits of selecting on-exchange plans is the access to subsidies. So, if  you don't qualify, check out off-exchange plans to see if they’re cheaper.


Could it be right for me?

This could be best for the frequent/preventative, frequent/pre-existing condition, and Family category of customers - especially if you or your family has a high gross income. If you can’t find a plan that works for you on the public exchange, this could be a cheaper option than COBRA

Major Pros: 

  • There's often greater diversity of networks, plans and  pricing available
  • Meet minimum requirements for ACA certification

Major Cons: 

  • No subsidies available - you are paying full price
  • Benefits can vary dramatically from state to state


Still curious about the difference between on/off marketplace plans? We found this article to be super helpful.  

Government-Sponsored Plans

Depending on your age and financial situation, you may also be eligible for government-sponsored healthcare.

Medicaid and Children's Health Insurance Program (CHIP)

Medicaid & CHIP cover healthcare costs for low-income households  (~$36k for a family of four) and children. If you’ve lost your income and can no longer afford insurance, Medicaid is a quality solution. One thing to note: Medicaid is not accepted by all service providers, and it’s primary purpose is to cover only your core health care needs.  Check out medicaid.gov for more. 

Medicare

Medicare is government sponsored health insurance that primarily serves people over the age of 65 (with some exceptions). Patients pay part of their services through small monthly premiums and deductibles. Check out medicare.gov for more information.

3. Comparison shopping for plans

Ok, so now that you have a better idea of your coverage options, it’s time to go shopping.  Fortunately, there are a bunch of sites that make it way easier to find a plan.


A quick heads-up → plans are organized by the type of plan (PPO, HMO, EPO, etc) and metal/tier (Bronze, Silver, Gold, Platinum).  These designations influence the pricing scheme and access to a network of service providers/benefits available. The sites below will help you make sense of it all, but be sure to read the plan details and not just the plan price.


Stride Health Insurance

Stride has a ton of large plan options, including those on your state’s ACA exchange. It’s easy to organize your plan by type, see which providers it includes, and how much you can anticipate spending overall and for basic things like birth control (TYSM!).

HealthSherpa

 HealthSherpa can help you price check ACA plans , and they provide hands-on  application support.

Healthcare.gov to find your state’s exchange 

Hot tip: When you express interest in a plan, insurance brokers get your digits and will SPAM you like wild. It’s actually super annoying, BUT you should really pick up the phone to speak to a few brokers and see if you can negotiate the price down for a plan you like.

If you're self-employed, there are new companies and plans being created just for you. Check out Catch.


Ultimately, health insurance decisions are very personal, and they do take a bit of time to sort out -- but you’re not alone! Send us your questions if you’re feeling stuck because this is really important (pardon the 90s dialogue box - we do answer all messages!).  If we don’t know the answer, we’ll find you someone who does :) .


All the health insurance <3,

Your friends at Mento

(aka Jordan, a recovering healthcare consultant, & Jamie, an aspiring health insurance aficionado who only recently learned the definition of 'deductible')


P.S. Did we get you the health insurance #mood?  Indulge in some of our favorite reads  ⤵️


Food for thought →

  1. How to understand your costs and key health insurance terms
  2. Insuring 30 million Lives: Navigating Health Insurance

Plan Specifics →

  1. Your Step-by-Step Guide to Choosing a Health Insurance Plan
  2. Bronze to Platinum: How Health Insurance Metal Tiers Work
  3. POS Health Insurance Plans - Point of Service
  4. EPO Health Insurance Plans - Exclusive Provider Organization
  5. HMO Health Insurance Plans - Health Maintenance Organizations
  6. PPO Health Insurance Plans - Preferred Provider Organization

Comparing plans →

  1. COBRA Coverage vs. ACA Health Insurance: Which One is Better?
  2. COBRA Coverage and Health Insurance Marketplace Options
  3. Find out what Marketplace health insurance plans cover
  4. The Pros and Cons of Obamacare
  5. Find out what Marketplace health insurance plans cover


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