Health Insurance After Layoff
by Thomas Milkman
The economic crisis is making it hard for everyone to earn a decent living. During the last year, millions of Americans lost their jobs because of the recession. But aside from the emotional and financial consequence of losing a steady paycheck, there are other concerns you need to deal with as well. One of the issues that a lot of laid-off employees are concerned about is their health care.
An employer effectively stops paying for the employee’s health care on the last day of the month when employment ended. It is critical for a person to look for health insurance while he is in-between jobs. This is because even if he finds employment immediately, his health coverage will only restart after 30 days of employment on the first day of the next month.
There is at least a two-month gap that should be filled. In addition, a person can be considered lucky if he is able to find work immediately. Today’s tough economic times have effectively halted hiring in a lot of industries. Below are some alternatives a laid-off employee can look into:
Short Term Medical Insurance – this health insurance plan can range from a single month to three years. It has been specifically designed to fill the gap from one plan to another. This insurance is inexpensive but it does not cover the cost of treating existing medical problems. Another drawback is that it also cannot cover serious long-term illnesses and pregnancy. But those with predictable expenses such as prescription and outpatient therapy should consider this insurance.
COBRA – if you worked for a company with 20+ employees, you are allowed to keep your health insurance for up to 18 months at your own expense. Because of its high monthly premium, a lot of people avoid this option unless they have an existing condition that requires ongoing medical care.
Individual Conversion – this has the same results with the COBRA option but it is designed for the employees of smaller enterprises. Individual conversion allows employees to convert their program from a group plan to an individual plan without the need to provide eligibility requirements.
These three options allow employees who had been laid-off to enjoy medical benefits until their next employment.
The economic crisis is making it hard for everyone to earn a decent living. During the last year, millions of Americans lost their jobs because of the recession. But aside from the emotional and financial consequence of losing a steady paycheck, there are other concerns you need to deal with as well. One of the issues that a lot of laid-off employees are concerned about is their health care.
An employer effectively stops paying for the employee’s health care on the last day of the month when employment ended. It is critical for a person to look for health insurance while he is in-between jobs. This is because even if he finds employment immediately, his health coverage will only restart after 30 days of employment on the first day of the next month.
There is at least a two-month gap that should be filled. In addition, a person can be considered lucky if he is able to find work immediately. Today’s tough economic times have effectively halted hiring in a lot of industries. Below are some alternatives a laid-off employee can look into:
Short Term Medical Insurance – this health insurance plan can range from a single month to three years. It has been specifically designed to fill the gap from one plan to another. This insurance is inexpensive but it does not cover the cost of treating existing medical problems. Another drawback is that it also cannot cover serious long-term illnesses and pregnancy. But those with predictable expenses such as prescription and outpatient therapy should consider this insurance.
COBRA – if you worked for a company with 20+ employees, you are allowed to keep your health insurance for up to 18 months at your own expense. Because of its high monthly premium, a lot of people avoid this option unless they have an existing condition that requires ongoing medical care.
Individual Conversion – this has the same results with the COBRA option but it is designed for the employees of smaller enterprises. Individual conversion allows employees to convert their program from a group plan to an individual plan without the need to provide eligibility requirements.
These three options allow employees who had been laid-off to enjoy medical benefits until their next employment.
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