Can I enroll in an ACA plan after losing my job?
What are my options for getting health insurance through the ACA marketplace if I lose my job?
Losing your job is considered a qualifying life event that allows you to enroll in health insurance through the ACA Marketplace outside of the annual Open Enrollment Period. If you lose your job and employer-sponsored health insurance, you have several options for getting coverage through the ACA Marketplace. Here’s a breakdown of what you can do:
1. Special Enrollment Period (SEP)
Losing your job-based health insurance triggers a Special Enrollment Period (SEP), giving you the opportunity to sign up for an ACA health plan. You have 60 days from the date you lose your coverage to enroll in a plan through the ACA Marketplace.
A. How to Qualify for SEP
Job loss: If you lose your job and the health insurance that comes with it, you qualify for an SEP.
Reduction in hours: If your work hours are reduced to the point where you no longer qualify for your employer's health plan, you also qualify for SEP.
Voluntary job change: Even if you voluntarily leave your job, you are still eligible for an SEP as long as you lose employer-sponsored health insurance.
2. Subsidies and Financial Assistance
When you lose your job and apply for health insurance through the ACA Marketplace, you may qualify for financial assistance to help lower the cost of your coverage.
A. Premium Tax Credits
Premium tax credits are available to individuals and families with household incomes between 100% and 400% of the Federal Poverty Level (FPL). These tax credits reduce the monthly premiums you pay for ACA health insurance.
If your income is significantly reduced due to job loss, you may be eligible for larger subsidies to make your ACA plan more affordable.
B. Cost-Sharing Reductions (CSRs)
If your income is between 100% and 250% of the FPL, you may qualify for cost-sharing reductions (CSRs). These lower your out-of-pocket costs (deductibles, copayments, and coinsurance) when you use healthcare services.
CSRs are only available if you enroll in a Silver-tier plan.
3. How to Choose a Plan
When enrolling in the ACA Marketplace, you will have several coverage tiers to choose from. Each plan varies in terms of premiums, deductibles, and out-of-pocket costs:
A. Bronze Plans
Lower premiums but higher out-of-pocket costs.
Ideal if you want to keep your monthly premium low and don’t expect to need many medical services.
B. Silver Plans
Moderate premiums and out-of-pocket costs.
Best for those who qualify for cost-sharing reductions (CSRs), which make Silver plans more affordable when using healthcare services.
C. Gold and Platinum Plans
Higher premiums but lower deductibles and copayments.
These plans are best if you anticipate needing frequent medical care and want lower out-of-pocket costs for each visit or treatment.
4. COBRA as an Alternative to ACA Plans
When you lose your job, your employer may offer you COBRA coverage, which allows you to continue the same health insurance plan you had through your job. However, COBRA can be expensive because you’ll pay the full premium (including the part your employer used to pay).
If COBRA is too costly, enrolling in an ACA plan may be a more affordable option, especially if you qualify for premium tax credits or cost-sharing reductions.
A. COBRA vs. ACA Plans
COBRA: Continue your exact same employer-sponsored plan, but you must pay the full cost of the premium.
ACA Plans: Typically offer more affordable coverage through subsidies, especially if your income has decreased.
5. Medicaid as an Option
If your income drops significantly after losing your job, you may qualify for Medicaid, which offers free or low-cost coverage depending on your state’s eligibility requirements.
A. Medicaid Eligibility
Medicaid eligibility is based on your household income and state of residence. States that expanded Medicaid under the ACA generally cover individuals with incomes up to 138% of the FPL.
When applying through the ACA Marketplace, the system will automatically check if you qualify for Medicaid and direct you to the appropriate program.
6. Short-Term Coverage
If you need immediate or temporary coverage while you explore long-term options, you may consider a short-term health insurance plan. However, be aware that short-term plans are typically less comprehensive than ACA plans and may not cover essential health benefits like maternity care, mental health services, or prescription drugs.
7. Steps to Enroll in ACA Coverage After Job Loss
Follow these steps to get covered through the ACA Marketplace:
Visit the ACA Marketplace: Go to healthcare.gov or your state’s Marketplace website to begin the application process.
Report your job loss: During the application, indicate that you’ve lost employer-sponsored coverage to qualify for the Special Enrollment Period.
Provide your income: Estimate your income for the rest of the year. If your income is reduced due to job loss, you may qualify for subsidies and financial assistance.
Compare plans: Review the available plans and select the one that best fits your needs and budget.
Enroll: Choose your plan and complete the enrollment process within 60 days of your job loss.
Key Takeaways:
If you lose your job, you qualify for a Special Enrollment Period to sign up for an ACA plan within 60 days.
You may qualify for premium tax credits and cost-sharing reductions to lower the cost of your ACA plan, depending on your income.
Consider whether an ACA plan or COBRA coverage is more affordable based on your financial situation and healthcare needs.
For help enrolling in an ACA plan after job loss or understanding your coverage options, schedule an appointment with a Tsunami Advisor here: Schedule an Appointment.
