If you’ve lost your health insurance because you’ve lost your job or had your hours cut recently, as millions of Americans have (opens in new tab) due to COVID-19, you’ll qualify for a 60-day Special Enrollment Period so that you can enroll in an Affordable Care Act health plan. If you miss your 60-day window to enroll, you’ll have to wait until Open Enrollment Period (unless you have another qualifying event (opens in new tab)), which isn’t until November.
There are government subsidies available (depending on your income) that can reduce the cost of insurance. Most people on HealthSherpa are able to find a plan with a monthly premium of $50/month or less, and 1 in 3 pay $10 a month or less.
Your health insurance options
If you lose your coverage, you have three major options for health insurance:
1. COBRA.
You continue the insurance you had with your employer, but you pay the entire premium. This option is expensive, but generally comprehensive and with the most access to doctors. Expect to pay hundreds to thousands per month.
Also known as Obamacare or Affordable Care Act insurance. The government pays some or all of your premium based on your income. Comprehensive, but may limit access to specific doctors. Expect to pay $0 to hundreds per month, depending on if you qualify for subsidies based on your income.
3. Medicaid.
Free or low-cost coverage for low income individuals and families, though availability varies by state (pregnant women and children are always covered). This insurance is comprehensive, and you must be low-income to be eligible. Expect to pay $0 to tens per month.
A note about COBRA. We typically do not recommend COBRA because Marketplace insurance is almost always more affordable than COBRA, even if you don’t qualify for subsidies. Another thing to keep in mind is that once you sign up for COBRA, you can’t switch to a Marketplace plan unless you have a qualifying life event (like moving, having a child, getting married, etc.) or you wait until Open Enrollment (November 1).
Which type of health insurance are you eligible for?
Marketplace subsidies and Medicaid eligibility depend on your income and household size.
Here’s a table of eligibility based on income in states that have expanded Medicaid, which include: AK, AZ, AR, CA, CO, CT, DC, DE, HI, ID, IL, IN, IA, KY, LA, MA, MD, ME, MI, MN, MT, NE, NV, NH, NJ, NM, ND, NY, OH, OR, RI, UT, VA, VT, WA, and WV.
The exception to this table is California—California has added new subsidies for middle-income people, so you may qualify for subsidies if you make up to $75,000 for an individual.
Here’s a table of eligibility based on income in states that have NOT expanded Medicaid, which include: AL, FL, GA, KS, MO, MS, NC, OK, SC, SD, TN, TX, WI, WY.
Since these states did not expand Medicaid, some residents may fall into the Medicaid gap, where they make too much to qualify for Medicaid and too little to qualify for Marketplace subsidies.
What to do if you’ve lost your employer-sponsored health insurance
If you’ve lost your health insurance due to layoffs or hour reductions, we recommend doing the following steps:
1. If your spouse’s employer offers you health coverage, enroll in it.
This is typically the most cost-effective option if it is available to you.
2. Don’t sign up for COBRA. Consider your other health insurance options first.
COBRA (opens in new tab) coverage is usually significantly more expensive than Affordable Care Act (ACA) health insurance, also known as Marketplace insurance or Obamacare. Plus, the ACA provides government subsidies that reduce the cost of insurance depending on your income. In addition, once you sign up for COBRA, you won’t be able to switch to a Marketplace plan unless you have a Qualifying Life Event—meaning you could be stuck with COBRA as your only option.
3. Sign up for Medicaid or a Marketplace plan.
The costs of going uninsured during the COVID-19 pandemic could be very steep (the average cost of coronavirus hospital treatment is $20,292 (opens in new tab)), so we recommend getting health insurance coverage. You can call us at 855.772.2663 to enroll.
Depending on your income and the state you live in, you could qualify for Medicaid (opens in new tab). Medicaid is a program jointly funded by the federal government and the states to provide health insurance to low-income Americans, and eligibility is determined based on income level (although some states have not expanded Medicaid, so the income bands depend on which state you live in). Medicaid covers one in four children, 21 percent of all low-income adults, and 60 percent of nursing home residents in the United States at this time.
If your income is too high for Medicaid, you may still qualify for subsidies and cost savings that can make Marketplace plans very affordable. 1 in 3 people on HealthSherpa pay $10/month or less for Marketplace insurance.
Medicaid and Marketplace plans are all comprehensive, ACA-compliant insurance plans that cover all of the essential health benefits, including COVID-19 testing, emergency care, mental health, maternity care, and more.
Enter your zip code here (opens in new tab) to see if you’re eligible for Medicaid and to see Marketplace plans and prices.
You can also call us at 855.772.2663 to enroll.
4. Avoid short-term plans, health sharing ministries, and indemnity plans.
You may see plans on other websites that are labeled “short-term health insurance (opens in new tab),” and we do not recommend these plans. Short-term plans typically do not cover pre-existing conditions, preventive care, emergency services, mental health care, prescription drugs or maternity care. If you have a short-term health insurance plan, know that you may need to pay out-of-pocket for any coronavirus testing or coronavirus-related hospitalization you may need for treatment. Only plans that are regulated by the Affordable Care Act, such as those available on the Health Insurance Marketplace, must contain no-cost Essential Health Benefits.
Similarly, health sharing ministries typically do not cover pre-existing conditions, can charge more based on your health status, and usually exclude treatment for mental and behavioral health and substance use disorders. They don’t always cover preventive care, and they can limit or exclude prescription drugs. These plans don’t offer the consumer protections outlined by the Affordable Care Act.
We recommend avoiding indemnity plans, which provide you with flat cash payments instead of covering a percentage of your bills. Because medical bills are very high, cash payments frequently don’t cover much of your total bill.
5. See what other benefits you could be eligible for.
Other benefits may help you with your financial burdens. Look into your eligibility for the following benefits. You’ll have to apply with your state’s office:
