young african american man needing health coverage outside of open enrollment

What Are My Options if I Lose Healthcare Coverage?

Maintaining health insurance coverage is a vital step in your plan to remain financially secure. However, there are times in life when your health coverage may be interrupted. When this happens, it’s imperative that you find affordable health insurance coverage quickly in order to protect yourself and your family.

Why Would My Coverage Be Cancelled?

There are a few factors that could contribute to the loss or interruption of health insurance coverage. If an individual does not pay their premium, their policy may be canceled. This is not always a result of poor money management; if there has been a significant change in income or other pressing financial obligations, it is easy to redefine financial priorities and let those monthly insurance premiums slide. It is also possible that individuals can lose their coverage when a grandfathered plan is canceled. However, the loss of a job that provided insurance coverage is the more likely reason someone may lose their benefits.

These factors are very hard to foresee, and therefore can be very stressful when you learn that your health insurance coverage is going to be affected. However, as soon as you find out your coverage is being canceled, there are steps you can take quickly to make sure you maintain health insurance coverage for you and your family and protect your financial stability.

Option #1: Continue Existing Coverage through COBRA

COBRA is a Federal law that makes it possible for individuals who were covered under company health insurance plans to maintain those existing plans following a job loss. In order to take advantage of COBRA benefits, the individual must pay the full monthly health insurance premium amount. These amounts are usually substantially higher than what you were previously paying because in most cases the employer was paying a portion of your monthly premium. The COBRA plan, however, does ensure that your existing policy will stay intact for up to eighteen months following a job loss. This is crucial for many individuals who have severe health problems and would be in financial jeopardy if they lost their coverage for even a short amount of time.

Option #2: Purchase a New Plan on the Insurance Exchange

If an individual loses health insurance coverage due to the loss of a job, purchasing a new health insurance plan on the insurance exchange could be better, and more affordable, answer to your problem. The Insurance Exchange is a multi-carrier private exchange offering a wide range of health insurance choices for individuals and their families.

These types of benefits are time-sensitive, so it is best to begin the process before losing your insurance coverage. Although insurance exchanges usually have set open enrollment periods (running from November to February), those who suffer from a job loss are offered a Special Enrollment Period to allow them to obtain coverage within a specific time frame after the job loss occurs.

Which Do I Choose?

The most cost-effective solution for most people is to seek a new plan entirely. Insurance plans on the exchange offer generally lower monthly premiums than what you’d pay for your existing plan under COBRA. However, it is crucial that you do not waste time, as the special enrollment period for these plans is 60 days from the qualifying event or last date of coverage. It is important to act quickly to get the best selection of plans and ensure you are able to obtain coverage within the required time frame.

Young biracial woman in business attire smiling on a cell phone on an overcast day

Need Health Insurance and Miss out on Open Enrollment?

Your Guide to Understanding Qualifying Life Events and Special Enrollment

Life happens, and when it does, it is very likely that your health insurance coverage may need to change. When you encounter a qualifying life event that impacts your insurance needs, it is important to know that you can take advantage of a special enrollment period – since most people are unaware that they may enroll outside of open enrollment.
This guide is created to help you understand everything you need to know about qualifying life events and the special enrollment period. You will learn whether or not you qualify and what documents you will need prior to enrolling and shopping for coverage.

#1 Loss Of Coverage

Due To:

  • Termination of group coverage
  • Reduction of hours to part-time status
  • Loss of employer contribution
  • COBRA ending
  • REQUIRED PROOF: Letter from employer, Certificate of credible coverage

#2 Marital Status Change

Due To:

  • Marriage
  • Divorce
  • Legal separation
  • REQUIRED PROOF: Marriage Certificate or divorce/separation court documents, Certificate of credible coverage.

#3 Dependent Status Change

Due To:

  • Birth of a child
  • Adoption
  • Aged out of dependent status
  • REQUIRED PROOF: Child’s DOB, Legal adoption paperwork, Certificate of credible coverage.

#4 Moving

Permanently move to another state and/or no longer live in the existing/prior plan’s service area.

REQUIRED PROOF: New Mortgage Bill/Renter’s Agreement and drivers license, utility, Postal Service change of address receipt.

#5 Death

Your primary policyholder passed away leaving you with no coverage.

REQUIRED PROOF: Death Certificate, Copy of termination letter from prior insurance company.

#6 Income Change

That makes you newly eligible or ineligible for a tax credit.

REQUIRED PROOF: Copy of certificate of creditable coverage OR a copy of the termination letter from prior Insurance Company and/or federal or state agency.

#7 Non-Calendar Year

Your current plan ends on a non-calendar year basis.

REQUIRED PROOF: Copy of termination letter from prior insurance company OR Certificate of Credible Coverage Anytime that you enroll in a plan you will be asked to provide the following information:

  1. What was your qualifying event?
  2. What was the date of this event?
  3. You’ll be asked to submit supporting documents.

So how long is this special enrollment period? Typically, you only have 60 days from the QLE to enroll in a new plan due to ACA law, carriers are very strict on enrollment timelines.