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What Happens to Insurance Once a Job Ends?

When you leave your job or get fired, one of your primary concerns should be what to do about your health insurance coverage. In this situation, you can pursue a few options that will allow you to be covered for medical expenses. In some cases, continuing your existing coverage is the best option.

  1. Continuing Your Coverage

    • When you lose your job, one option is to continue your existing health insurance coverage. This is possible through a program known as COBRA, or the Consolidated Omnibus Budget Reconciliation Act. With COBRA, you have the right to continue your health insurance coverage for 18 months after you leave your job. If you are disabled, you can extend that limit to 29 months. With this option, you simply have to make your premium payment to keep your coverage.

    Cost of COBRA

    • When you lose your job, the cost of COBRA might make it tough to afford. When you work for an employer, your employer most likely paid for a portion of your premium payment. Now that you do not have a job, this will no longer apply. You must pay for the entire premium for you and your family. In some cases, this could cost $1,000 per month or more. This often leads many to look at other options.

    Electing COBRA

    • If you decide to get COBRA coverage, notify your employer soon after you leave your job. Once the employer notifies the insurance company that you are leaving, you have 60 days to notify the employer that you want COBRA coverage. At that point, start sending your premium payments to your employer so that you can continue to get your coverage.

    Individual Plans

    • When you lose your job and you do not want to pay for the potentially high costs of COBRA, you may need to consider an individual health insurance plan. These are offered by private insurance companies and in some cases, they are less expensive than what you pay for COBRA. You might have to agree to a high deductible so you can afford your monthly insurance premiums. The plan must have sufficient coverage for you and your family.

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