What to do about your Health Insurance when you get Laid off

Funny you should ask . . . I work(ed) for an insurer and was laid off at the end of February!

ASK for the details of your severance package, if you were fortunate enough to get one.

Does it include health insurance?

If so, find out how long the company will pay your premium or what portion of the premium it will pay, and what your termination date is for the purposes of health insurance coverage. If not,

INQUIRE about continuation options.

COBRA is a Federally-mandated continuation that employers (who have 20 or more employees) must offer except in certain circumstances. The employer must offer you this option, but the timing on it can be tricky. The cost for this type of continuation is completely your responsibility and may include a nominal administrative fee.

Some states require smaller employers to offer a shorter continuation period to you and your eligible dependents – again at your own cost. This is sometimes referred to as “State Continuation” or “Mini-COBRA.”

RESEARCH individual coverages. Many group premiums are so high that the unemployed cannot possibly afford to pay them.

Individual health plans are those that anybody can purchase by calling, walking into an office, or appling online with an insurer to obtain coverage. This type of health insurance plan has more restrictions than group coverages but is typically more affordable. Insurers who offer these plans can impose severe restrictions or outright deny you coverage, based on pre-existing conditions.

There may exist in your state an option to join a state-funded pool of individuals who cannot otherwise obtain health insurance.

EXPLORE other options. If your spouse has health insurance through his employer and you have opted not to join that plan before, now is the time to do so! Part of a federal law called HIPAA (Health Insurance Portability and Accountability Act) includes crediting a new plan with certain criteria you may have met on your employer’s plan. This is one of the few times you can join a spouse’s plan if you didn’t sign up when it was first offered.

Above all, ask questions, read your current plan document, and if you still don’t understand, ask again. Your Human Resources department should be able to answer
most questions and your insurer can help a great deal, too. A local health insurance agent and your insurer representative are great resources and can advise you what is best for your situation.