In US: Lost Job = Lost Health Insurance?

I’m not well acquainted with American health insurance. I understand Medicare is for elders and Medicaid for lower income families. I understand the goals of Obamacare and that it extended the number of people with coverage.

But my impression is that for many, health insurance is partially or mostly paid by employers. If people are laid off, furloughed or lose their job, does that mean that during a pandemic millions of people have lost their health insurance as well?

Yes and no. If you lose your job you do lose your health insurance. However, you have a couple of options. First, there is Cobra, which lets you continue your coverage for 18 months as long as you pay the full premium (both your portion and employer portion). If you were paying $300 a month but the employer was covering 75%, you would now have to pay $1200 a month. You also can sign up for the ACA (Obamacare). Depending on your income you may be eligible for a subsidy. If your income is low enough, you can get on Medicaid, if the state you live in has expanded Medicaid. So the short answer it that you do lose your insurance, you have options to purchase individual insurance but it most likely will be extremely expensive, especially if you are out of work.

To elaborate - normally you can only enroll in an ACA plan during the open enrollment plan at the end of the year. But if you lose your health insurance as a result of a Qualifying Life Event (e.g. death of your spouse, or losing a job and losing your employer-provided health care), then you are allowed to enroll.

But if you opted not to enroll last fall, you can’t just decide to enroll now. Because it’s supposed to be insurance - you can’t just wait till you need it and then buy insurance.

A point of caution… you can continue coverage under COBRA if you lose your job, but your employer must continue the policy. You send your COBRA premium to your former employer who is supposed to send that on to the insurance company.

But if the business stops paying the policy then the former employee loses coverage. That former employee would then need to take out an Obamacare policy to be able to maintain coverage.

I remember that when I moved from California to Arizona I lost my health coverage, I had the COBRA option, but the [del]poison[/del] price was too high when your income gets lower in a new place.

Not the only one that found early how unsustainable the current health care was/is in the USA back in 2009:

http://www.cnn.com/2009/HEALTH/01/23/cobra.health.insurance/

So, again from someone who knows very little about the intricacies of the US system, are you seeing a surge in unemployment related applications for ACA? This sounds like an interesting latent problem on so many fronts. Given the politics of healthcare in the USA, this must be quite a curve ball.

Only with some employers, some employers you pay it directly to the insurance company. Also not all employers are large enough to be covered by COBRA.

Being able to pay for COBRA is pretty much a nonstarter if you just lost your job.

Also if you live in a state that didn’t take the Medicaid expansion such as Texas you can’t enroll in Medicaid even if your income is now 0 unless you meet certain requirements. No able bodied unemployed childless adult is going to qualify.

I think you can enroll in ACA if you lose your job and therefore your insurance but it’s not being advertised or promoted and you may not get a rate that’s low enough if your income is 0 and you can’t get on Medicaid. You fall into the cracks in a state that didn’t take the expansion.

There’s undoubtedly been an increase – as scr4 noted above, losing your employer-based health insurance is a “qualifying life event,” allowing one to apply for an ACA policy right away.

But, I suspect that the surge won’t be as big as one might think. Even the cheapest ACA policies are pretty expensive, in the absolute, and applying for a subsidy to help pay for it is a separate process.

I wouldn’t be surprised if there are a lot of suddenly-unemployed Americans who would be interested in buying an ACA policy, but are discovering that the costs of the premiums are prohibitively expensive for someone who now has no income, and may well not have much in the way of savings, either.

Also, my understanding is that if you’ve been furloughed, your employer may still be keeping you covered under their group health insurance policy, even if you aren’t being paid during the furlough. (This isn’t the case if you’re laid off, or if your employer goes out of business.)

Most middle-class Americans are one life event from going bankrupt. This pandemic is gonna be that life event for thousands and thousands of families.

After losing a job, you only get 60 days to apply for new insurance. If you carry your COBRA for a couple months but have to stop because you can no longer afford it, you can no longer get insurance until the following year because you went past the 60 days. It is the most fucked-up system imaginable.

This week’s The New Yorker talks about how impossible it is for people in non-expansion states to qualify for insurance, and the resurgence of women dying of (treatable!) cervical cancer. It describes women in Alabama with low-paying jobs who couldn’t afford insurance because to qualify for Medicaid there, a family of 4 must have an income of less than $393 per month - 18% of the poverty line. Shameful beyond comprehension.

it’ll be millions and millions. Its going to be bad.

Sadly, I have very little faith in America so I don’t see anything changing anytime soon with these problems. Maybe in the 2030s at the earliest.

That’s my understanding, too.

However while employers will still pay their share of the premium, I believe employees will have to con ti nue paying their share. This can be a substantial amount. I read some time ago that a typical policy for family coverage costs $15,000 annually and the employer typically pays 2/3. The employee will have to pay about $400 a month – much more than many can afford.

Obamacare is extremely affordable if you get anything from the government (and you don’t have to be at the poverty level to get that extra money). If you’re 100% out of work, obviously there’s a problem if you’re not making any money at all. But I was working part-time and paid maybe $40 a month for insurance. Not the greatest insurance ever, but it was something. I have a better job now, but I’m still making only $2000 a month, and I still use Obamacare, as my small company doesn’t provide insurance. I get $400 a month toward insurance.

As someone using an ACA policy, they really aren’t. Or at least, they don’t have to be. I was working part-time and paid about $40 a month for mine several years ago (I now work full time and so I pay more for a similar policy, but it still isn’t back-breaking. I make a little over $2000 a month).

If I may ask, are you getting a subsidy to help pay the cost of your premiums? $40 a month is substantially lower than anything I’ve ever seen for an ACA policy without the benefit of the subsidy.

(Disclosure: I indirectly work in the industry – I’m in advertising, and my primary client is a health insurance company; I worked specifically on communications for their ACA policies for several years.)

(Edit: looks like you answered this already in your answer to psychobunny)

It’s worse than that; this is going to break the business model of the health insurance industry. They’ll losing millions of payers while getting tens or hundreds of thousands of new claims for people in critical care units that cost tens of thousands of dollars a day. Maybe one good thing to come out of this will be a move away from private and employer-provided basic health care insurance but it is a problem no one seems to be paying attention to right now, so my optimism is not high.

Stranger

The shit of it all is that a lot of people end up with medically-related financial distress – even though they have insurance. They don’t realize that they don’t have the right coverage, or that the ambulance they rode in was “out of network.” It’s a ridiculous, scammy patchwork system and I hope that COVID causes the health system to collapse.

I’m actually with **asahi ** on that. I hope this breaks the back of this shitty patchwork expensive punitive nasty health insurance system. There’s going to be HELLA pain in the meantime but it could have an awesome outcome if it causes enough Americans to realize that YES even young healthy people could have a medical emergency at any time and we all need to band together and use taxes to cover every American goddammit.

I’m probably overly optimistic because the US is a nasty punitive country and there’s going to be, like I said, a lot of pain and death to get there, but we’re already on that path anyway so I hope it can make enough Americans realize that health coverage tied to employment is a precarious system at best.

I’ll never forget all the times since I was in my 20s that I tried to get health insurance and was threatened with legal consequences in the paperwork for lying about any preexisting conditions. That’s punitive and pretty scummy to threaten people with fines and jail for having a medical issue. I can’t stress that enough. Only Obamacare ended that practice.