Are You Eligible for COBRA
If you lost your job recently, you are probably eligible for a COBRA health insurance plan. Your COBRA health coverage is exactly the same health insurance plan you had while insured, except you'll be paying the entire premium for now on.
Do you Qualify for the COBRA Subsidy?
If you became unemployed due to a lay-off and make less than $150,000 per year as a single, you are eligible for a federal subsidy of 2/3 the cost of your COBRA health insurance plan. The term for the subsidy was originally set at 12 months, but has been extended another 6 months recently. So if you qualify for the subsidized COBRA plan you're going to want to take advantage of it.
The 60 Day Window
If you didn't get laid off, and thus don't qualify for subsidized COBRA coverage, don't be hasty. You have a 60 day window to enroll in COBRA. Use that time to shop for an individual health insurance plan. Individual health insurance is what people who are self-employed buy for themselves and their family. For the time being, you are self-employed. What you'll find is that individual health plans can save you money. Of course, a plan that will save you a lot of money will cover less, and be less comprehensive than your group health plan was. But hey, you're unemployed so it's more important to save money right now.
Short Term Unemployment
If you believe you're employment will be a short one, that you'll be employed again within 6 months and be eligible for a group plan, you should still buy individual health insurance rather than short-term health insurance. This is because short-term health plans have very limited coverage and do not cover any preexisting conditions from the past 5 years. Only consider short-term insurance in the event that you do not medically qualify for an individual insurance plan.
Cheap Health insurance
Buying an affordable, high-deductible health insurance plan, is a great value for someone who is unemployed. For instance, a high deductible plan with a $7500 deductible can cost an individual less than $100 monthly. The plan can be terminated at any month and, even though it will not provide a lot of coverage for routine health services, the insured gets the benefit of the insurance company's deep discounts at the doctors' offices, hospitals, laboratories, and other medical providers. For instance, a typical hospital stay might cost $4000-$5000 for someone who is not insured. But if you have a high deductible plan and stay at the hospital for one day the cost of that stay is typically marked down by 50-60%. So for the unemployed, either way, purchase the COBRA or get an individual health plan, whichever turns out to be the better value.
If you have any questions, you can call us for free at 800-557-5693. We are here to help 9 AM to 5 PM Pacific time. There is also a lot more health insurance information you can browse through on our site. You can also get a free health insurance quote online...