Insurance When Unemployed

Employed workers usually participate in employer-sponsored group insurance plans. However, with many workers losing jobs, they now find themselves needing alternatives to group health insurance. Health costs are continually rising, making the need for insurance more prevalent. Unemployed workers have a few options when considering insurance choices. It is important to research all options to find what works best for you and your family.

COBRA

• The Consolidated Omnibus Budget Reconciliation Act (COBRA) allows unemployed workers who lose their health benefits the right to choose to continue receiving coverage through their group health plans. Coverage under COBRA is offered to the employee, the employee's spouse and the employee's dependents. COBRA is offered for a limited time. In most cases, the premiums paid to COBRA are much higher than the premiums paid on an employer-sponsored insurance plan. Unemployed workers may have to pay the insurance premium up to 102 percent of the plan's costs. Employers that have 20 or more employees must provide this continual health coverage to prior workers.

Individual Insurance

• Some unemployed workers cannot afford the premiums for COBRA and have to look towards individual insurance plans for health coverage. Premiums on individual insurance plans are still higher than premiums for group plans.You may find it difficult to obtain coverage if you have a pre-existing condition. The insurance company will ask you to provide proof of your health condition, and may even reject an application from those who do not meet their health guidelines. Individual insurance plans offer several options, including health maintenance organizations (HMOs), preferred provider organizations (PPOs) and point-of-service (POS) plans. You should choose the plan that best fits your needs.

CHIP

• Children's Health Insurance Program (CHIP) provides coverage for children abiding in low-income households. CHIP is a state-mandated program and participants must meet eligibility requirements to receive coverage. Services provided by CHIP include doctor visits, prescription drugs, eye exams and glasses, dental services, hospital care, treatment of pre-existing conditions, vaccines, laboratory tests and x-rays.

Medicaid

• Low-income families may qualify for their state's Medicaid program. Medicaid sends payments directly to healthcare providers for the services you receive. You must meet eligibility requirements to qualify for Medicaid. The program is administered by the states, and each state establishes its own guidelines and specific services offered. Common services offered by all states typically include inpatient and outpatient hospital care, physician services, nurse midwife services, pediatric services, laboratory and x-rays, prenatal care, and family planning services.