Whether you’ve chosen to be unemployed or found yourself without a job due to circumstances beyond your control, having health insurance is crucial. In 2007, a staggering 62% of all bankruptcies were due to medical expenses, and that was before the financial crisis hit. This is a significant increase from 2001, where medical-related bankruptcies accounted for only 45%. It’s alarming that in a country as wealthy as ours, such a high percentage of bankruptcies are due to medical bills.
If you find yourself unemployed for an extended period, it becomes increasingly challenging to bounce back financially. Losing your steady income is bad enough; facing a medical emergency without insurance could drain your savings and push you into poverty.
One option for health insurance if you’ve recently left a job is COBRA, which is available if your previous employer had over 20 employees and offered insurance benefits. COBRA allows you to keep your existing healthcare coverage for a limited time after leaving your job, though you’ll have to pay the premiums yourself. It’s not free; the cost can be the same as what you paid while employed, and it generally lasts from one to six months.
For those married or with a long-term partner, consider joining your spouse’s health plan. This can be a cost-effective way, often resulting in substantial savings compared to individual plans. For instance, one individual found they could save $300 a month by switching to their spouse’s plan after losing their job.
For younger individuals up to age 26, the Affordable Care Act allows you to remain on or join your parents’ health plan. It’s a helpful option that covers many young adults who might otherwise go uninsured.
If these options run out or don’t apply, the internet is invaluable for finding affordable insurance. Sites like eHealthInsurance can help you find plans that balance cost with coverage, sometimes as low as $105 a month with reasonable out-of-pocket limits.
For those considering early retirement, making less might paradoxically be beneficial. If your income is within 400% of the Federal Poverty Limit, you could qualify for substantial healthcare subsidies.
Remember, ignoring your health insurance needs to save a bit of money each month can lead to disastrous financial consequences, especially given that a significant percentage of bankruptcies are due to medical bills. It’s vital to have at least disaster-level coverage to protect against the unforeseen. Always consider your options carefully and choose a plan that balances affordability with necessary coverage.
