Yesterday I spent some time talking about the importance of having good health insurance if you're unemployed, as well as the pros and cons of keeping your old health care program through COBRA .
But COBRA's not your only option. What else can unemployed Americans do to keep or obtain good health insurance? Here are some other tips.
Latch onto your spouse's plan. If you're married or live in a state with domestic partnership laws, chances are you can hitch a ride on your spouse's health care plan - even if the benefit year has already started. Most companies have "emergency inclusion" allowances for spouse's employees who lost their jobs. A big bonus: the cost of latching on to your spouse's plan is significantly cheaper than anything COBRA offers. Your spouse's human resources department will know the score.
Consider a high-deductible plan. To cover your bare minimum health care needs (i.e., doctor visits, prescription drugs, check-ups for your kids), consider a bare-bones, high-deductible health care plan. Yeah, they're primarily for people with little or no pre-existing conditions, and if a calamity occurs, you're going to dig deep to pay for treatment. But high-deductible health care plans will more likely give you some basic health coverage and save you a ton of money. Most high-deductible plans offer essential preventative care before reaching your deductible requirement. You can opt for plans with deductibles ranging from $500 to as much as $10,000. Basically, the higher the deductible amount, the lower your monthly, out-of-pocket expenses. Studies show that high deductible health care plans can save 50% or more in monthly payments. And, once you hit your deductible limit (say, $5,000), your insurance provider covers 100% of your bills, on an annual basis. For some decent, high-deductible health care options, visit Ehealthinsurance.com or FastAndFreeInsuranceQuotes.com.
Double down with SCHIP. Congress recently expanded the role and scope of the federal government's State Children's Health Insurance Program (SCHIP) recently, pouring $38 billion of new funds into the program, and promising to add an additional 4.1 million uninsured children in to the SCHIP program by 2013. When I looked into the newly expanded SCHIP, I was surprised to see how low the exemptions were for American families to get their kids full medical insurance. In many instances, investment returns, Social Security benefits, and even wages earned by spouses weren't considered income via SCHIP - greatly increasing your chances of qualifying for the program. If you do qualify, the government pays for your kids health care and you can sign up for cheaper, non-family health coverage, on your own. Different state rules on SCHIP apply, but most seem pretty loose. Check out StateHealthFactsOnline.org and see where your state stands on SCHIP.
Get short-term health care coverage. People hop from job to job all the time, even thought that trend should slow down in this economy. If, however, you expect to be back in the workforce within six months to a year, or even want to tack on some extra, post-COBRA coverage, then consider short-term health insurance. It's a band-aid approach, and isn't as comprehensive as regular health care insurance, but a short-term deal can buy you time, cover you against big emergencies, and offers low-cost, same-day approval for the transitioning unemployed. Some programs cost a few hundred a month (usually for healthier and/or younger applicants, but most short-term programs I saw cost a lot less than COBRA). Insure.com offers a good tutorial on the topic, along with a link at the bottom to your state's insurance commission for more info on where to fund good programs.
Fight for group coverage.
On average, individual health insurance, especially for those with pre-existing conditions, are much more expensive than group plans. If you're on your own, like most unemployed people, then get creative and attach yourself to group plans through your church, your social club, any professional service or trade organizations, or veterans’ organizations. I checked around and a lot of local Chamber of Commerce groups offer good health plans for members, too.
Things may get a bit easier, thankfully, for unemployed Americans after the big stimulus bill becomes law. As it stands right now, the new bailout bill has a few COBRA provisions attached that will reduce the cost of COBRA benefits by 60%, making it more affordable and expand age limits. For Americans in jobs for 10 years or more, or those who are over 55, COBRA would be made available until age 65, instead of being cut off after 18 months.
So if you've lost your job, keep hope alive - and set a positive tone by insuring you and your family have decent health care coverage while you tackle the job market. All it takes is some adjustments to your sails. The rest is just riding out the storm.
Brian O'Connell contributed to this article.