When You Can't Make Health Insurance Payments

When your finances are limited and you need to tighten your budget, pricey health insurance premiums may be one of the first expenses you either defer or eliminate. Though health insurance provides important protection against both expected and unexpected medical needs, not paying your premium may help you navigate your financial hardship, albeit with consequences that could affect your ability to find affordable health coverage in the future.

Fees

• If you will have the money to pay your health insurance premium, but are simply lacking the cash in hand when the payment becomes due, your health insurance company may allow you to make a late payment. Some insurers offer grace periods following your premium due date, during which time the insurer will pay any qualifying claims you make. However, depending on your insurer's policies, you may or may not have to pay a late fee for paying after your premium due date.

Cancellation of Coverage

• If you do not pay your health insurance premium by the time your grace period expires, your insurer may cancel your coverage without further notification. Any claims you make will not receive payment, and in order to reinstate your benefits, you may have to apply for health insurance coverage all over again. If you previously had a locked-in monthly rate, you may also find that your insurance premiums are higher than before.

Finding Insurance

• If your financial circumstances leave no room in your budget to pay for health insurance premiums, you may have difficulty finding coverage in the future when you reapply. For example, if you developed a health condition since you last applied for health insurance, you may find that your new health insurer will provide limited benefits for the condition, charge you a higher premium or even deny you coverage altogether.

Employer Insurance Plans

• If your health insurance policy is a part of an employer's group health insurance plan, you may have difficulty canceling your health insurance in order to save money. By law, insurers are allowed to require that all eligible employees enroll in an insurance policy. Ask your employer or human resources manager if you can opt out of your group insurance plan, but keep in mind that most employers deduct health insurance premiums through employee paychecks, so you may not have a choice regarding your insurance premium payments.

Considerations

• If your inability to pay for your health insurance premiums stems from a job layoff, you may qualify for COBRA coverage, through which your previous employer may pay for a portion of your health insurance premiums following your layoff. On the other hand, if you cannot afford your health insurance premiums due to a dramatic drop in your income, you and/or your dependents may qualify for Medicaid or the Children's Health Insurance Program, each of which provide comprehensive health benefits to low-income individuals and families that meet state financial eligibility guidelines.