Change in Life = Change in Insurance?
Most of us have experienced some kind of major change in our employment. These kinds of big changes are sometimes expected, sometimes they’re not. It’s important to understand that a job change may mean you’re eligible to make changes to your health coverage, even outside of open enrollment.
One of the toughest things about a job change can be the loss of employer-sponsored health coverage. If you’re experiencing a change in employment, be prepared to work closely with the HR department and/or a benefits administration company. You’ll want to ensure you’re being offered coverage for the time period for which you’ve already paid from your paycheck; this may be beyond your termination date.
You may also be offered coverage through the Consolidated Omnibus Budget Reconciliation Act (COBRA) which mandates that some employees be allowed to maintain coverage through the employer’s group plan—albeit on your own dime. COBRA can be expensive and only lasts for a defined period of time, typically 18 months.
Another, usually more affordable option is buying a new plan through the Obamacare or Affordable Care Act Marketplace. When this health insurance law took effect, it introduced open enrollment periods for individuals and families who were buying insurance for themselves. Outside of open enrollment, which ended on January 31, 2016, the average consumer can’t purchase insurance.
However, when you experience major life events (like a job change), you’re allowed to buy insurance outside of open enrollment during what’s called a special enrollment period. Although paying for your own insurance may still be more expensive than what’s offered through an employer, some health plans bought through the Obamacare Marketplace are eligible for premium tax credits (help paying for your coverage each month) and cost-sharing reductions (help lowering out-of-pocket costs like deductibles).
Be aware that a laundry list of life changes—adding members to your family, changes in marital status, moving your residence, etc.—exists and these changes may qualify you for a special enrollment period. It’s also vitally important to act quickly as each special enrollment period only lasts for a certain amount of time, typically 30 to 60 days.