Being unemployed is tough, but getting health insurance doesn’t have to be. Learn about COBRA insurance, Medi-Cal, and how you may qualify for financial help through Covered California.
Losing your job is hard enough, and it often means also losing your health insurance. But remember, when it comes to staying covered, you have options. You can avoid a lapse in insurance — and the financial penalty that comes with it — by understanding the options available to you and your family. Yes, this time can be overwhelming, but here’s a guide to help you through it.
Check Your Spousal Benefits
If your spouse or domestic partner has a job that provides health insurance, you might be able to get covered under their plan. He or she may need to contribute more to their employer-sponsored health insurance, but this is often an easy, lower-cost option.
What is COBRA Insurance
When you lose your job, you have a legal right to your former employer’s health insurance plan through the Consolidated Omnibus Budget Reconciliation Act or COBRA. This continuation of coverage is offered not only to you but also your spouse, a former spouse, and any dependent children. You have 60 days to enroll in COBRA once your employer-sponsored benefits end. You may even qualify if you quit your job or your hours were reduced. Other COBRA qualifying events include divorce from or death of the covered employee.
Some people choose COBRA because they feel strongly about keeping the same health care providers, but it comes at a cost. Because your employer will likely no longer be pitching in, you will be responsible for the full cost of the plan yourself — plus an administrative fee. Keep in mind that COBRA coverage typically only lasts 18 to 36 months.
Buying Health Insurance
You can also buy a health plan directly from an insurance company. If you’re shopping for a plan, explore Covered California, a free service that connects California residents with brand-name health insurance companies such as Anthem, Blue Shield, Kaiser, Health Net and more. Through Covered California, you will be able to shop for and compare various plans to find the one that works best for you.
Covered California offers financial help (in the form of a federal tax credit) to lower your monthly health insurance premium. This can make a huge difference, especially during times when money might be tight. Many pay $10 or less a month for a plan, but you’ll never pay more than 8.5 percent of your household income for a benchmark Silver plan.
Check Your Medi-Cal Eligibility
If your annual income is reduced due to job loss or another reason, Medi-Cal might be an option. Medi-Cal provides free or low-cost health insurance for qualified applicants including low-income families, people with disabilities, pregnant women and more. Check if you qualify here by matching your household size and your income. You can apply for Medi-Cal through Covered California as well.
Apply During Special Enrollment
While this is an important decision, don’t wait too long to choose a solution. Losing health insurance coverage — no matter if you were laid off, let go with cause, you quit, or any other reason — qualifies you to apply through Covered California 60 days before and after the date your coverage stops. This period is calledspecial enrollment. You also qualify for special enrollment if your COBRA coverage runs out.
If you’re eligible for Medi-Cal, you can enroll at any time. If you’re not eligible and you have an annual household income at or below 150 percent of the federal poverty level, you can get coverage through Covered California year-round.
Losing your job can be a challenging life event, but know that you have the options and support you need to find a health insurance plan that’s right for you. Learn more about Covered California, and if you’re ready to get started on an application, you can do so here.
FAQs
People who are unemployed may be able to get a health plan through Covered California that includes savings based on your household size and income. You or your family members could also qualify for free or low-cost coverage through Medi-Cal.
How does Cobra insurance work if I quit my job? ›
COBRA coverage lets you pay to stay on your job-based health insurance for a limited time after your job ends (usually 18 months). You usually pay the full premium yourself, plus a small administrative fee. Contact your employer to learn about your COBRA options.
What is the 60 day loophole for COBRA? ›
Once your employment ends, you have 60 days to elect COBRA coverage with your former employer. Some people all this the “60 day loophole for COBRA.” COBRA is retroactive, which means that it begins the day after your employer coverage ends.
What do I do if I can't afford COBRA? ›
Instead of enrolling in COBRA continuation coverage, there may be other more affordable coverage options for you and your family through the Health Insurance Marketplace, Medicaid, or other group health plan coverage (such as a spouse's plan) through what is called a “special enrollment period.” Some of these options ...
What disqualifies you from Medi-Cal? ›
Eligibility for Medi-Cal, California's Medicaid program, is primarily determined by income, with households needing to earn less than 138% of the federal poverty level (FPL).
How much do I have to make a month to qualify for Medi-Cal? ›
Most single individuals will qualify for Medi-Cal if there income is under $1,676 per month. Most couples will qualify if their income is under $2,267 per month. If you have disabilities, your income can be slightly higher. You can qualify for Medi-Cal even if you have assets.
Is it better to use COBRA or Obamacare? ›
But ultimately, it depends on your situation. If you're not eligible for government subsidies and the costs of COBRA and ACA are similar, or if you've used up the deductible on your employer insurance before you leave your job, it might make sense for you to do a COBRA plan.
Is COBRA more expensive than regular insurance? ›
COBRA coverage is not cheap.
Why? Because you're now responsible for paying your portion of your health insurance: The cost your employer contributed to your premium, in addition to the 2% service fee on the cost of your insurance.
Who pays for COBRA after termination? ›
Some employers may subsidize or pay the entire cost of health coverage, including COBRA coverage, for terminating employees and their families as part of a severance agreement.
What happens if you have COBRA when you enroll in Medicare? ›
If you have COBRA before signing up for Medicare, your COBRA will probably end once you sign up. You have up to 8 months after you stop working (or lose your health insurance, if that happens first) to sign up for Part B without a penalty, whether or not you choose COBRA.
The following are qualifying events: the death of the covered employee; a covered employee's termination of employment or reduction of the hours of employment; the covered employee becoming entitled to Medicare; divorce or legal separation from the covered employee; or a dependent child ceasing to be a dependent under ...
How long can you stay on COBRA benefits? ›
While COBRA is temporary, in most circ*mstances, you can stay on COBRA for 18 to 36 months. This coverage period provides flexibility to find other health insurance options.
Why is Cal-COBRA so expensive? ›
For some people, the cost of COBRA is just too expensive. The high cost of COBRA is often because your employer is the one who is responsible for covering most of the monthly premiums when you have job-based insurance. This makes coverage fairly affordable for most active employees and their families.
Who is not eligible for COBRA? ›
Why would an employee not qualify to enroll in Cal-COBRA? The employee is enrolled in or eligible for Medicare. The employee does not enroll within 60 days of receiving the notice of eligibility from the employer. The employee is covered by another health plan.
What is the Cal-COBRA law? ›
Cal-COBRA allows individuals to continue their group health coverage for up to 36 months. For individuals covered under federal COBRA, Cal-COBRA may also be used to extend health coverage for a combined period of up to 36 months.
How much can you have in the bank to qualify for Medi-Cal? ›
asset information? eligibility for Medi-Cal. For new Medi-Cal applications only, current asset limits are $130,000 for one person and $65,000 for each additional household member, up to 10. Starting on January 1, 2024, Medi-Cal applications will no longer ask for asset information.
Does Medi-Cal verify income? ›
The Department of Health Care Services (DHCS) needs the information to verify your income for Medi-Cal. DHCS will not use or share the information for other purposes except with your permission or as permitted by law.
How do I get an emergency Medi-Cal? ›
1 – Go to the emergency room. If you are experiencing a true medical emergency, where your only choice is to go straight to the nearest hospital, then go. The hospital will provide you with the health care you need. Then, the hospital's billing department will assist you in applying for emergency Medi-Cal benefits.
Can I get covered in California if I lost my job? ›
You can get health coverage!
If your job was affected by COVID-19, or if you lack income because your hours were cut or you're no longer working, Covered California is here for you.
