Consider These Coverage Options To Avoid Paying For COBRA

When you lose your healthcare coverage due to changes in your job situation, such as a layoff, being terminated (as long as the termination was not for gross misconduct or reduction in employment hours), or quitting, if you work for a company or government entity that employs more than 20 people, you may be eligible to continue using your employer’s health insurance coverage after the qualifying event that separates you from your employer.  However, COBRA insurance typically has a high cost because you have to pay the full premium, including the portion your employer previously paid on your behalf and up to 2% for administrative fees.

COBRA Alternatives: Short-Term Health Insurance

You can always get short-term health insurance to cover the lapse between your current insurance and a new insurance plan. You can quickly apply and may quickly get approved, you can get a quote online for it in minutes, and your coverage can potentially start the day of the qualifying event. You can also apply any time—not just during an open-enrollment window, as is the case with traditional health care plans.

A few drawbacks are included, however.  You can be denied coverage due to a pre-existing condition, and it may not cover certain health benefits that you require, such as maternity or mental health services.  Short term insurance is also, as it states, short term- meaning it’s only offered for one month to under one year, depending on your locality.  There may also be limitations to the dollar amount covered.  

It’s also worth noting that if your short term insurance runs out during a non-open enrollment period, it is not considered a qualifying event to get another form of insurance outside of that provided by a new employer.  

Affordable Care Act Marketplace Health Insurance

For those seeking long term traditional health coverage that is not covered under an employer, the ACA marketplace can offer plans for those who need one due to a qualifying event. Under the Affordable Care Act, you qualify for health insurance through your state’s health insurance “Marketplace” or “exchange,” which is a health plan shopping and enrollment service run by your state or by the federal government if your state doesn’t operate one.

Independent Health Insurance

Independent health insurance is a plan bought straight from a private insurance company outside of the ACA marketplace.  You cannot qualify for government assistance with one of these plans.  This is a good choice for a COBRA alternative for those who do not meet the financial requirements to qualify for an ACA plan, but would like a more comprehensive and long-lasting alternative to short term health insurance.  

High-Deductible Health Insurance

Whether you choose a short-term, ACA, or independent health insurance plan as a COBRA insurance alternative, picking a high-deductible plan generally reduces your monthly costs. These are plans that have a lower monthly premium but require you pay more in up-front health care costs—the deductible—before the insurance company begins to pay for coverage. Consider this solution if you feel that you are in relatively good health and are looking for ways to save money during a difficult financial time or in a year when you anticipate other large expenses. 

Navigating the world of health insurance can be confusing, and it’s important you get the right plan to fit your needs.  It’s a good idea to get help where you can.  You can get free assistance from a qualified specialist just by filling out a quick form.  You can get a list of choices immediately, and have professional guidance every step of the way.  Don’t try to do it alone when you don’t have to.