Quitting? How Long Will Your Health Insurance Last?
Quitting your job can be a liberating experience. Yet, you might wonder what to do next after the initial rush and excitement. One of the perks of employment is an employer-sponsored health insurance plan — how can you find health care coverage on your own? So, first, take a deep breath and get ready to read. Here’s everything you need to know about your health insurance after quitting to help ease the stress of transitioning to your new job.
What Happens Right After I Quit?
Leaving a workplace where you feel stuck is incredibly exhilarating! But after the excitement dies down, you may wonder, what now? When it comes to health insurance, a couple of things happen right after you quit and become a freelance grant writer, freelance personal trainer, or freelance copywriter.
Normal Enrollment Period
Every year, there is an open enrollment period for health insurance on the Health Insurance Marketplace. People without employment-offered health insurance can find individual plans there. The Health Insurance Marketplace is also where people eligible for need-based aid can find available health insurance options. The standard enrollment period for the health insurance marketplace is usually between November and the end of January. However, that enrollment period can be different if you’ve experienced a life event that leaves you without health insurance (i.e., job loss!).
Special Enrollment Period
After quitting a job, you will be eligible for a particular enrollment period. This period is for people who just left their jobs and need time to find a new option for their health insurance needs. Immediately following your decision to quit your job, you will be eligible for a particular enrollment period. This period is 60 days following the qualifying event that made you lose your original insurance options (which, in this case, is leaving your job).
This 60-day period gives you the time to research the options available. If you want to look into other options on the Health Insurance Marketplace for you and your family, you can do so within these 60 days.
If you don’t want to find a new health insurance plan immediately, you can continue your coverage through COBRA.
If you aren’t ready to look for new health insurance coverage or just like your employer’s plan, you may want to opt into COBRA. Before making this decision, though, here are more details to help you better understand COBRA.
So, What is COBRA?
COBRA is an acronym for the Consolidated Omnibus Budget Reconciliation ACT. You can read more about this continuation of health coverage on the U.S. Department of Labor website. COBRA is a health insurance program that rolls over your existing health plan. Eligible employees and dependents can obtain health insurance coverage benefits when they lose their job or are laid off. Even if you quit your job, your first option for continual health insurance may be COBRA.
The continued coverage you get from COBRA is through your former employer. Most companies that have 20 or more employees are required by federal law to offer COBRA to their employees. However, this coverage is limited to 18-36 months after your last day, depending on the exact situation of the individual and eligibility.
When you work for a large company with over 50 employees, your employer must pay some of your premium for health insurance coverage. However, if you fall below the hour’s threshold, get laid off, or leave your job, they are no longer required to pay in on your premium. So while COBRA gives you access to the same health insurance coverage you had with your employer, you must pay the policy’s total price as a freelance illustrator, freelance carpenter, or freelance social media manager.
Pros of COBRA
Even though it may seem expensive, if you had a health insurance policy that worked well for you and your family, COBRA can help you extend that policy. This gives you a period to do your due diligence and find another option that works best for you.
Another pro of COBRA continuation coverage?
It continues covering any spouses or dependents you had on your employer-provided plan. If your policy covers your entire family, keeping that up for a while will give you peace of mind rather than having little to no insurance coverage.
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Cons of COBRA
The biggest con of opting in for COBRA coverage is paying the total premium price. You may not have realized how much your previous employer paid for your health care costs. This can add a high cost to your monthly premium bills that can be difficult to cover after leaving your job.
COBRA health insurance can also be terminated if not paid on time.
After leaving your job, you may not have as much income to cover a high premium cost. The stability of the plan is reliant on your past employer as well.
COBRA plans are group plans that your employer opted in for. So if something changes and they no longer offer those group rates, you may no longer have access to a COBRA plan.
Alternatives to COBRA
Becoming a freelancer can open you to many new opportunities, even regarding your health insurance. There are alternatives to COBRA plans that you can look into.
Some of the alternatives include:
- High deductible plans and health savings accounts
- Joining a partner or spouse’s plan
- Private health insurance
These alternatives may not work right away, but if you are weary of COBRA and want to look for something else, there are options for you.
See also: What is Critical Illness Insurance?
Navigating the Health Insurance Marketplace
Now that you know more about your health insurance options in the short term, you can relax a little, knowing you have time to explore other options.
If you decide not to go with COBRA or are coming up at the end of your coverage period, turn to the Health Insurance Marketplace. While it may seem intimidating initially, you can find great coverage options through the Marketplace that work for you as a freelancer.
What Exactly is the Marketplace?
The Health Insurance Marketplace is where anyone in the United States can look for private health insurance options. It started with the Affordable Care Act (ACA) to ensure that anyone can find health insurance that works for them based on their income. Every plan will offer similar coverage options.
You can expect to see the following covered under Marketplace plans:
- Doctor’s visits
- Preventative care
- Other specialized care
You can also see if you qualify for assistance programs through the Marketplace or health insurance options for low income.
Who runs the Marketplace can vary from state to state. Some states operate their Marketplace, while others use the Federal Marketplace. Whether your Marketplace is managed by the state or federal, you can find an insurance company to work with based on your annual income.
How to Navigate the Marketplace
The Marketplace can be intimidating when you’re first looking into it. However, you can quickly find and compare healthcare options once you get familiar with the website. You’ll see several options when you get to the Marketplace website, healthcare.gov. They provide helpful guides and tools that can show you exactly where to go based on what new plan you’re looking for. If you need help, there are customer service numbers and FAQs that can answer your general questions and point you in the right direction.
Types of Marketplace Plans Available
If you are under 65 or otherwise ineligible for Medicare or Medicaid, you can look at the different types of plans on the Marketplace. However, if you are eligible for Medicare or Medicaid and opt-in for those plans, you cannot also have a plan from the Marketplace.
Marketplace Plans In-Depth
The Marketplace has four main plans: bronze, silver, gold, and platinum. But first, let’s look at what makes these plans differ.
The bronze plan has the highest amount of out-of-pocket contribution. This is a good plan if you would like to have a low monthly premium. The downside is if you need coverage in an emergency medical situation, you will have to pay a lot out of pocket before the insurance plan starts to pay.
The silver plan is more moderate than the bronze plan. It has a reasonable monthly cost when you find yourself needing health care. This is a good option if you’re okay with paying a little more monthly to cover more of your routine care.
If you opt for the gold plan, you’ll be paying higher monthly costs and lower care costs. However, deductibles on gold plans are usually low and can be the right option if you regularly use medical care.
Platinum plans have the highest monthly premiums, with the lowest care cost you can opt-in for. In addition, the deductibles of this plan are very low. As a result, the platinum plan can come in handy if you need ongoing care or emergency services due to underlying medical conditions.
Regardless of your plans, you can always apply for lower premiums and health tax credits when searching for plans on the Marketplace.
Finding the Right Plan as a Freelancer
Finding a plan as a freelancer may feel difficult since you’re paying for most of your health care on your own without the help of an employer anymore. But this leaves you open to finding more personalized options. For example, your past employer may have only offered some group options. In addition, they may have had extras you didn’t need but still had to pay for. Finding your healthcare plan on the Marketplace can help you personalize your benefits. The plans on the Marketplace can be more limited, though, and you may want something more for yourself and your dependents.
You may also like: Here’s How to Get Your 1095-a [AND Fill it Out]
Alternative Benefit Options
Whether you prefer remote work, are in a creative field, or want to leave corporate life to pursue a passion, you can make a great living as a freelancer. Freelancers thrive off of flexibility and having different options for their lives. So if COBRA or the Marketplace aren’t cutting it, you can still sign up for alternative benefit options.
Freelance and Gig Worker Benefits
Freelancers and gig workers can enjoy more flexible benefits through the Alliance of Gig Workers (which you can sign up for on Selfgood). The Alliance of Gig Workers offers services to make finding benefits more accessible than ever for freelancers and gig workers. If you’re looking for a place to find personalized care that fits your lifestyle, Selfgood has a couple of ways to help you. With a support team, resources, and exclusive deals from partners, you’ll find great alternative benefits from the traditional Marketplace. There’s even a specific place to find services tailored to aid mental health. But, of course, you’ll still need help when you’re working alone. So more personalized benefit options can give you the aid you need to keep yourself and your business in the best shape.
Starting a new chapter in your life can be intimidating, but your benefits shouldn’t have to suffer. Transitioning to freelance work will take time, but once you know about the health benefits available, you can enjoy more peace of mind.