Record numbers of people have filed for unemployment due to COVID-19-related closures. If you're one of these people, know you're not alone.
If you lost your health insurance coverage when you were laid off, know you have options for getting the coverage you need.
If you didn't have health insurance through your job and want to have coverage just in case, you also have options for getting insurance.
I'll review your options for both cases and review how recent legislation has affected health care coverage:
- I had insurance through my former employer.
- I did not have insurance through my employer.
- I want to learn about legislation responding to COVID-19 and its effect on medical expenses.
I had insurance through my former employer.
Because you lost your health coverage when you lost your job, you qualify for a special enrollment period. This allows you to enroll in a health insurance plan even though it may not be open enrollment. Special enrollment periods end 60 days after the qualifying event.
If your spouse has health insurance through their employer, you can work with their human resources department to be added to be added to your spouse's plan during your special enrollment period.
You can also choose to extend your former employer's coverage through COBRA, buy private health insurance, or buy an Affordable Care Act plan through the health insurance marketplace.
If these plans aren't a good fit, you can explore alternatives. These options include short term health insurance, health insurance ministries, and government-funded plans. To learn more about these, jump ahead to "I did not have health insurance through my former employer."
For more on Special Enrollment Periods, read "[Infographic] 5 Questions to Ask About Special Enrollment Periods".
COBRA
COBRA stands for the Consolidated Omnibus Budget Reconciliation Act. It allows you to continue your employer-sponsored coverage for 18–36 months. To be eligible for COBRA the following must apply:
- Your former employer must have had at least 20 employees for more than half of its business days last year.
- You were terminated, but not for gross misconduct. Or, your hours were reduced.
If you're a dependent of someone who lost their job or now has reduced hours, you also qualify for COBRA. Dependents are also eligible for COBRA if the employee becomes eligible for Medicare, in situations of divorce or legal separation, and if the employee passes away.
If you choose to enroll in COBRA, you'll take full financial responsibility for participating in the health plan. The employer contributions will become your responsibility.
"If someone loses their job because of COVID-19, they should first figure out when their health insurance will run out and what COBRA will cost them. COBRA is typically prohibitively expensive, but may be worthwhile if you have special or extensive health care needs or existing health care relationships you need flexibility to maintain," Deborah Gordon, The Health Care Consumer’s Manifesto author.
Your former employer is legally obligated to provide you information on COBRA and enrollment. You typically have 60 days from when you receive the election notice or lose coverage, whichever is later to decide whether to enroll in COBRA. COBRA can also be retroactive, so if you do not enroll and need medical care within the 60-day election period, you can enroll, pay past premiums, and have coverage.
You can enroll yourself or your dependents separately in COBRA. Each eligible person must make an election to be covered through COBRA.
For more information on COBRA, read the Department of Labor's helpful FAQ.
Private insurance
Insurers can offer plans that do not meet the Affordable Care Act guidelines. These plans are sometimes called off-exchange plans. Because they don't have to cover everything Affordable Care Act plans do, you may be able to find a plan that offers the coverage you need at a lower price.
These off-exchange plans can have a lot of variability, so you need to carefully review what's covered and what isn't along with the premiums and out-of-pocket costs. Working with an independent insurance agent can help ensure that you find a plan that meets your needs.
Affordable Care Act plans
If you visit HealthCare.gov, you can view the Affordable Care Act plans available in your area. Depending on your financial circumstances, you may be able to qualify for a subsidy on monthly premiums.
Affordable Care Act plans do not have exclusions for pre-existing conditions and provide comprehensive coverage for health care services.
If you're in good health and are under 30, you may be able to opt for a catastrophic plan. These plans have low premiums and high deductibles. These plans are designed for people who don't have medical concerns and mainly need coverage for emergency situations.
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I did not have insurance through my former employer.
If you did not have health insurance through your former employer, you'll have to wait for the next open enrollment period to enroll in a typical health plan. However, some states have opened statewide special enrollment periods because of COVID-19 concerns. Do a quick Google search or check this helpful HealthInsurance.org article to see what your state has done.
If your state has opened a special enrollment period, review the options in the "I had insurance through my former employer." If not, the options below are still available to you.
Short term health insurance
Short term health insurance can be bought year-round. These plans offer coverage for doctor visits and emergency room services. In some cases, they may even offer some coverage for prescriptions.
These plans are very limited because they do not cover pre-existing conditions. Once your current short term plan ends, any medical issue that occurred within that time frame is a pre-existing condition when you renew or buy another plan.
If you just need some coverage to get you through, a short term plan can be a great option. Just be sure to pick the longest term length you need in case any medical issues arise.
For expert advice on short term health insurance, read
- Short Term Health Insurance: 5 Questions You Should Ask Before You Buy
- Short Term Health Insurance: What Top Companies Offer
Indemnity health plans
You can also buy indemnity health plans without needing an enrollment period. These plans offer set benefits for specified health care services. You'll be responsible for paying your health care provider and making claims with the insurance company.
"An indemnity plan may pay a maximum of $3,000 per day for a day in the hospital or maybe $5,000 a day, some only pay $300–$400 per day. So you have to really understand how they work. It can be a great value, but education is crucial," says Eric Wilson, Principal of Wilson & Associates.
Understand what the fixed payments are for claims and check what services are covered. You'll also want to pay attention to coverage exclusions. Like short term health insurance, indemnity plans typically do not cover pre-existing conditions.
Health care sharing ministries
Another alternative to health insurance are health insurance ministries. Health care sharing ministries are usually connected to religious groups and expect members to live religious, low-risk lifestyles and be healthy. These are attractive, especially to people in good health, because the monthly premiums are usually lower than health insurance.
Laura Handrick, Choosing Therapy contributing HR professional, shares her experience with a health care sharing ministry:
"After extensive research, we chose a health share instead of insurance. The costs of these programs run 50–75 percent less than traditional healthcare. For just over $400 per month, we have access to low-cost medications, free telehealth, and affordable medical visits. Catastrophic health issues are covered, often at higher rates than traditional insurance."
While these ministries can offer valuable coverage, realize that health care sharing ministries aren't technically insurance. They do not have the same legal obligations as insurers. Do thorough research because covered services vary.
For more information on health care sharing ministries, read HealthInsurance.org's health care sharing ministry overview.
Government-funded plans
The government funds several programs to help specific demographics access health care. Most people become eligible for Medicare when they turn 65. However, there are other eligibility criteria that allow people to qualify sooner with certain diagnoses like End-Stage Renal Disease.
Medicaid eligibility is primarily determined by income. In some cases, you may qualify because of disability or significant medical needs. Check your state's Medicaid policies even if you think you won't qualify. Some states have expanded Medicaid to increase access.
"Some people may qualify for Medicaid, the public insurance program for lower-income people. In some areas, not as many doctors or health care providers accept Medicaid, but, to cover you in a gap, it may be worth signing up. It is usually free or very low cost if you qualify, and the benefits are mandated and comprehensive," says Gordon.
The Children's Health Insurance Plan (CHIP) provides health insurance for children who do not qualify for Medicaid, Medicare, or have other health insurance access. If you don't qualify for Medicaid, you may be able to get coverage for your children through this program.
Telemedicine subscription services
Telemedicine services are not health insurance. However, buying a telemedicine subscription can make it easier and more affordable to receive non-emergency medical diagnoses and medical advice.
Telemedicine apps work differently. Some are subscription-based and allow a certain number of virtual visits per month. Others are fee-based and charge a set fee for each virtual visit. As you compare telemedicine services and costs, be sure to check that the application's security is HIPPA-compliant.
Telemedicine is especially helpful right now as clinics and hospitals have instituted protocols and restrictions to prevent the spread of COVID-19. Having access to medical professionals through telemedicine can help offer you peace of mind.
For more on telemedicine, review:
- Telemedicine: What You Need to Know
- What to Expect from Telemedicine
- Yes, You Can Get Health Care While Social Distancing
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I want to learn about legislation responding to COVID-19 and its effect on medical expenses.
Several pieces of legislation have been passed in response to COVID-19 including the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Families First Coronavirus Response Act.
"A key focus of the CARES Act is the adoption of a variety of measures designed to expedite the approval and availability of drugs and devices needed to fight the pandemic, to shore up the financial positions of hospitals and other healthcare providers facing unprecedented demands, and to temporarily relax restrictions that may make it more difficult for patients to obtain access to needed testing and care," says Roger Milliner, MetroPlus Health Plan Chief Growth Officer.
Federal legislation has responded to the many different types of needs created by the current crisis throughout the United States. States have also taken independent action to respond. We'll focus on federal changes specifically related to health care and health insurance.
These governmental changes have made accessing telemedicine easier.
"The CARES Act expands telemedicine so that healthcare providers and consumers can speak over the telephone, Skype, or Facetime to conduct a medical appointment. Telemedicine allows for diagnosis and a treatment plan to be developed over the phone, and the doctor can order labs or prescriptions as needed. This ease and efficient use of technology is typically a much more cost-effective solution that can help people who are uninsured receive reasonably priced treatment.” says Jan Dubauskas, healthinsurance.com Vice President.
The CARES Act also expanded how Health Savings Accounts (HSAs) can be used to include telemedicine, over the counter drugs, and menstrual products.
Some insurers also made adjustments to cover telemedicine visits the same way they cover in-person visits on plans that did not include coverage for telemedicine.
As far as handling COVID-19 health expenses, the Families First Coronavirus Response Act and the CARES Act have made managing those costs easier for people with and without health insurance.
- If you do not have health coverage, the Provider Relief Fund will be used to pay eligible hospitals at Medicare rates for treating uninsured COVID-19 patients if they do not do balance billing for all COVID-19 treatment.
- If you have health insurance, your insurer is required to cover your cost-sharing payment for COVID-19 testing.
- The Trump administration has also negotiated with well-known health insurers like Cigna and United Health Group to have cost-sharing payments waived for all COVID-19 treatment costs.
- The CARES Act also incentivizes providers to bill all COVID-19 treatments at in-network rates with payments.
"The CARES Act will make payments to certain providers if they agree to treat all COVID-19 patients with a preferred payment schedule as in-network patients, keeping costs down for patients whose coverage is out of network," says Dubauskas.
Even with these legislative measures in place, your hospital may not qualify for or seek these incentives. If you get an unexpected bill, ask questions about the CARES Act and what payment options exist. In some cases, it may be helpful to seek a lawyer's advice.
"In the worst case, if you don’t qualify for lower-cost insurance and you can’t afford to buy private coverage, you can wind up with a hefty medical bill if you get sick with COVID-19 or otherwise. In that case, negotiate! Ask for a payment plan. Seek forgiveness for the medical debt. No matter what, though, get care if you need it, and sort out the finances when you can," recommends Gordon.