Updated: 1/13/2020 When you’re unemployed, simply covering the most basic costs of living can be a challenge. During this difficult time it’s hard to justify the additional expense of paying…

Healthcare Options When You're Unemployed

How to Find Healthcare Options When You’re Unemployed

Updated: 1/13/2020

When you’re unemployed, simply covering the most basic costs of living can be a challenge. During this difficult time it’s hard to justify the additional expense of paying for healthcare coverage as well.

But ignoring the need can leave you vulnerable to more problems, especially in the event that you or a family member has a health emergency. Without insurance coverage, you’ll find your access to necessary healthcare is limited. It’s also possible to find yourself in this situation managing sky-high medical debts you have no way to repay.

Fortunately, there are ways to get the coverage you need without putting your financial future at risk.

How Going Uninsured Can Cost You

Remember, under the Affordable Care Act (ACA), you face a penalty for electing to go without health insurance when you can actually afford to pay for it. The base fee for not having coverage in 2016 and 2017 is either 2.5% of your household income or $695 per adult (whichever is greater.) The fee gets paid when you file your federal tax return for the year you don’t have coverage.

Moreover, electing to go uninsured could leave you saddled with outstanding medical debt. According to a December 2015 study performed by the Kaiser Family Foundation, about 25% of participants reported they or another household member had problems paying medical bills over the course of that year. If you forgo coverage to cut costs when you’re unemployed, you could easily wind up in this debt-ridden group. This makes it very difficult to build credit during a time when you need it most.

Healthcare Options for the Unemployed

Fortunately, there are a number of places you can turn to for healthcare coverage when you’ve lost your job. If the first option you check is a poor fit, it helps to keep looking. Here’s a list of your major options. Each is directed at a unique segment of the healthcare consumer market.

  • Medicare: Three main groups of people are eligible for this federal insurance coverage: those ages 65 and older, some younger disabled individuals and people with end-stage renal disease, notes the official Medicare website.
  • Medicaid: Medicaid is combined federal and state coverage for low- and limited-income individuals. The income specifics vary by state, and eligibility is determined by each state’s respective health department.
  • CHIP: The Children’s Health Insurance Program is the joint federal and state children’s health insurance program. It’s designed to ensure children up to age 19 whose families earn too much for traditional Medicaid but not enough to afford higher-priced coverage have access to healthcare.
  • CHAMPVA: The Civilian Health and Medical Program of the Department of Veterans Affairs (formerly CHAMPUS) is a type of coverage available to veterans. It’s administered by the Veterans Health Administration Office of Community Care.
  • COBRA: Continuation of Health Coverage is coverage you can get when you’ve first separated from your job. It allows you to stay on your existing healthcare plan for a limited time. However, your premiums can go up significantly — up to 102% of the plan’s cost.
  • The ACA Exchanges. As a result of the ACA, health insurance coverage can currently be purchased through federal or state exchanges. (Note: Due to the results of the recent presidential election, you may see significant changes made to your healthcare insurance options in coming years.) You can learn more about navigating these exchanges at Healthcare.gov.
  • Buy Direct. You can also comparison shop for affordable healthcare plans on the private market. Note: These are insurers who chose not to sell on the exchanges or comply with its rules.
  • Catastrophic Plans: A catastrophic plan is major medical coverage with a high deductible and low monthly premium. If you qualify for a catastrophic plan, it will show up as an option on the exchanges.

Open enrollment for 2017—the period of time you can enroll for healthcare—ends January 31st. However, if you happen to lose your job following this end date, you qualify for a Qualifying Life Event and can apply for health insurance up to 60 days following the date of your termination. If you have gone beyond the 60 days, you can apply for short-term health insurance until open enrollment begins again, starting in November.

More Alternatives for Low-Cost Coverage

School alumni associations, warehouse clubs that are exclusive to members, spousal healthcare plans, parental insurance, trade groups and trade unions are all options to consider. For example, Sam’s Club is a members-only warehouse that has collaborated with insurance provider Aetna to provide healthcare plans to its members.

One helpful way to approach shopping for healthcare coverage when you’re unemployed is to make a list of the types of coverage you need and want, such as dental and vision. If you’re looking for dental, consider a discount dental plan, which isn’t insurance but a membership plan that offers dental discounts at the dentist. When you know the specific features you want and need, it may be easier to find affordable prices and the coverage you require.


Guest Contributor: Jeanine Skowronski is the managing editor at Credit.com. Prior to joining Credit.com, her work was featured by TheStreet, Newsweek, Business Insider, Yahoo Finance, MSN, Fox Business, Forbes, CNBC and various other online publications. Follow her at @JeanineSko



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