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How Do I Get Health Insurance If My Employer Doesn’t Offer It?

Louis DeNicola
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Maybe you quit your job to turn your side hustle into a thriving business. Or, you may be between jobs or working part-time without benefits. Or quite simply you don’t know what to do if you’re not sure that you can afford health insurance. 

No matter the reason, you’re on your own when it comes to finding health insurance. 

The process can be confusing—and the coverage may be expensive—but here’s a brief overview of your options.

Continue your coverage with COBRA

If you had employer-provided group health insurance, you may be able to keep your insurance regardless of why you left. The insurance will continue to cover your family as well.

The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives you this right, and you’ll have at least 60 days to claim the COBRA coverage. You can usually stay on your COBRA plan for up to 18 months, although sometimes the coverage can continue beyond that point.

The downside is you’ll have to pay for the entire insurance premium plus an administrative fee, which can make this kind of coverage prohibitively expensive. There are sometimes exceptions when an employer agrees to cover part of the cost but they might not be required to help.

Additionally, COBRA doesn’t apply to every employee and you might not be eligible if you worked for the federal government or a small business that had fewer than 20 employees. However, check your state laws as well, as some states have mini-COBRA plans that require small businesses to offer a similar benefit.  

If you want to learn more, visit U.S. Department of Labor’s page about COBRA plans.

Sign up for a new insurance plan

You can generally only enroll in a new health insurance plan (either through HealthCare.gov, your state’s marketplace, or directly with an insurance company) during the enrollment period at the end and beginning of each year. 

However, you’re eligible for a special enrollment period if you lose your employer-sponsored coverage within the last 60 days, or expect to lose your coverage in the next 60 days. Getting married, divorced, a family member passing away, or having a child can also lead to special enrollment periods.

Purchasing a plan through HealthCare.gov or your state’s marketplace may be the best options as you could qualify for a “premium tax credit” that lowers your monthly premium amount. The value of the tax credit depends on your household’s size and income for the year. You also can’t be eligible for health insurance through a government program or file your tax return as Married Filing Separately (although, there are some exceptions) to claim the credit. 

If you’ve lost a job or are just starting a business, the lower income could help you qualify for a larger credit. However, don’t forget to update your income if you start working again or begin making more money than you expected. Whether you claim too much or not enough, everything gets evened out when you file your federal tax return. 

Look into Medicaid and CHIP

Medicaid and the Children’s Health Insurance Program (CHIP) programs offer free or low-cost health coverage to qualified low-income individuals and families. If you apply for health insurance through HealthCare.gov or your state marketplace, you’ll automatically be told if you qualify for one of these programs. 

Unlike other health insurance plans and programs, there’s no special or open enrollment periods for Medicaid and Chip—you can apply at any time. However, 13 states haven’t expanded Medicaid coverage, meaning you can’t qualify based on having a low-income alone. You may only be able to qualify if you meet the state’s income and additional requirements, such as being a parent, caregiver, pregnant women, elderly, or disabled.  

Final options—go uninsured or opt for a catastrophic plan

Starting in 2019, you’ll no longer have to pay a federal tax penalty if you go without health insurance. However, some states enacted their own tax penalties for residents who don’t have coverage, and you’ll be on the hook for the entire bill if you’re sick or injured and need help.

Some people have opted for joining lower-cost health care sharing ministries (HCSMs), cooperative groups that cover the cost of some medical procedures for members. However, unlike insurance options, you could be denied based on preexisting conditions (or related medical costs might not be covered), have a cap on benefits, and there could be restrictions on certain types of service (such as birth control or mental health benefits. 

Another option could be a catastrophic health insurance plan. These plans have high deductibles ($7,900 in 2019), don’t qualify for a tax credit, and are only available to you if you’re under 30 years old or qualify for an affordability exemption if other options are too expensive. 

The premiums are also much lower than you’ll find with other plans, and the plan could help protect you from having to pass on care or declare bankruptcy after a medical emergency. The plans also include preventative services and three primary care visits each year (even before you hit your deductible), which you can use to address health concerns before they become emergencies. 

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Louis DeNicola is a freelance personal finance writer and credit enthusiast. You can find him on Twitter @is_lou

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Opinions, advice, services, or other information or content expressed or contributed here by customers, users, or others, are those of the respective author(s) or contributor(s) and do not necessarily state or reflect those of The Bancorp Bank (“Bank”). Bank is not responsible for the accuracy of any content provided by author(s) or contributor(s).

 

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