Alternatives to COBRA Health Insurance
COBRA insurance offers you the ability to continue on your current employer's insurance plan for up to eighteen months after you have terminated employment.
You can use COBRA whether you chose to quit or if you have been fired. COBRA insurance typically has a high cost because you have to pay the full premium, including the portion your employer previously paid on your behalf.
If you toy with the idea of going without health insurance, understand that you can face fines at tax time by not having insurance, due to the Affordable Care Act. If you feel like you cannot afford health insurance through COBRA, other options exist that may work for your situation.
You have the option of getting short-term health insurance to cover the lapse between your current insurance and the insurance that you will get from your new employer. One of the advantages of this insurance is you can get through the application process quickly.
This insurance may have coverage limits and does not offer coverage for more than a year. Some policies offer a specific length of time, while other policies have a limit as to how long you can qualify for the plan.
Most short-term health insurance policies do not qualify as insurance under the Affordable Care Act but may help fill gaps in your coverage.
Short-term health insurance also has strict rules regarding coverage. If you have a pre-existing condition, or if you are pregnant or if your partner or spouse is pregnant, you might have a difficult time qualifying for short-term health insurance policies. Additionally, the policy may have a low lifetime and annual limit since this is not designed to be a long-term solution.
Under the Affordable Care Act, you may qualify for help paying for your health insurance through your state's health insurance exchange. Losing your job and health insurance coverage counts as a qualifying event and you may be able to qualify without waiting for open enrollment.
This is a viable option, and all policies will meet the Affordable Care Act health insurance requirements.
These plans may be a good option if you meet the income requirements for them. However, if you do not, you will need to consider the available independent health insurance policies.
Independent health insurance policies offer another alternative to COBRA insurance. You can find policies that offer good coverage at a lower cost than COBRA insurance. This makes a good option if you do not have preexisting conditions or if you are single.
This insurance policy can last for as long as you need coverage. The rates may increase each year. You can choose a deductible and copayment plan that best fits your needs. Your health insurance agent can help you make sure that the plan qualifies for the Affordable Care Act guidelines.
Check out these plans online or find an insurance agent that specializes in health insurance. Look for an independent agent who can show you a variety of competitive policies from several different companies.
A high deductible health insurance plan can make an excellent alternative to COBRA insurance. These plans have a lower monthly premium, but you have a high deductible to meet before coverage kicks in.
This solution works well if you are looking for ways to save money during difficult times. You can set up a health savings account in conjunction with a high deductible account.
This option makes the most sense if you think you will not use the insurance, but want to have it just in case. This type of policy protects you from the most expensive health care costs, but you will need to pay the full cost for your doctor visits until you meet your deductible.
Consider the cost of your COBRA insurance and the coverage it provides when you make the choice. At times the coverage offered may be very good or you may need this type of plan because of your family or preexisting health conditions. Carefully consider the monthly premium costs as well as out-of-pocket costs for this plan when comparing your other options.
COBRA gives you sixty days to determine if you need coverage. You may choose to wait with this option if you know you will have coverage in sixty days and then pay the premium if you end up needing the insurance. If you do this, you may face pro-rated penalties for your uninsured time, under the Affordable Care Act.
To make the correct choice for your individual situation, carefully consider all the options available to you. The cost of COBRA could even be less expensive than the alternatives. You may also go with short-term health insurance while you are waiting for approval on a high deductible or independent health insurance plan.
If you have a family, you may want to consider using different insurance for each family member depending on the history of the individual. You should avoid things like health shares, which sound like health insurance, but really are not.