Navigating health care plans during difficult financial times
Losing your health insurance in the midst of a global pandemic can feel like a double whammy. But you do have options, whether you’ve lost your job, and your coverage along with it, or your premiums have become more than you can afford due to a drop in your small business income. Understanding these options to keep yourself and your family members protected during this crisis is the first step.
First off, you don’t actually have to lose coverage to be eligible to adjust your premiums. Many people who enrolled in individual plans during open enrollment last year estimated their income for 2020, not knowing that we would be facing a work stoppage. If the income projection for your household has changed, you can update your existing application with healthcare.gov and potentially qualify for additional tax credits/subsidies to reduce your current premiums. In some cases, adjusting your income projection by as little as $2,000 can lead to significant changes in both your premium and plan design.
If you did lose coverage, that typically qualifies you for a special enrollment period that lasts 60 days from the date of your loss. This enables you to enroll in a major medical plan immediately and potentially at a significantly reduced cost if you qualify for a tax credit or subsidy. Just remember the tax credits or subsidies are based on your projected income for all of 2020, not just what you are or aren’t making today. Additionally, there is no penalty for being wrong as you simply repay any subsidies you weren’t entitled to on your 2020 tax returns.
You can check out plans without commitment online, where many websites allow you to enter your family information and shop anonymously. You’ll be able to see the differences in premium or plan design, without having to go through the identity verification or application process on healthcare.gov.
If you didn’t have coverage before the COVID-19 pandemic hit, but are now looking for a bare bones individual plan, just in case, there are short-term plans that cost about a third of their major medical Affordable Care Act counterparts. These plans are a bit of a throwback to old school health insurance where you have to answer health questions to qualify for the plan. If you are in good health and a low utilizer of insurance, these are great options and can last up to 33 months before you have to reapply.
What’s most important first is knowing that you have options. If you are going through a tough time and are dealing with a loss of income, reach out to a qualified agent who can help guide you through these scenarios. Just keep in mind that if you did lose coverage you only have 60 days to re-enroll in new coverage and your effective date will always be the first of the following month.
Insurance doesn’t have to be scary or confusing. Educating yourself about the coverage you have now and options for the future can help you prepare to make the best choices for your needs.
Dave Williams is the principal agent and business director for 843 Benefits and Health Marketplace.