Many individuals in the U.S. receive coverage through their spouse’s job, so when they retire they may lose that coverage. This was a scary prospect some time back but now people do have several options for health insurance if they lose their health insurance because their spouse has transitioned to Medicare. Thus, all such people do have options when their spouse is retiring and they will not continue to have access to employer-sponsored coverage. As their spouses will be covered by Medicare and they will not be covered as they are not yet 65, then there are several options available to them.
Job-based Health Insurance
If individuals have a job that offers them health insurance benefits but has waived that health insurance because they were covered under their spouse’s plan, then they become eligible for a special enrollment period at their workplace when they will lose access to the plan their spouses had pre-Medicare. This will allow them to enroll in their job-based health insurance even though it is not open enrollment for anyone else. Special enrollment periods are time-limited and it is usually of 30 days so individuals should don’t wait for too long, because if they miss then they will have to wait until the next open enrollment period to sign up.
Individuals whose spouse’s health plan is subject to the COBRA law, then they will be eligible to continue their current health plan for a limited time through COBRA continuation coverage. In the majority of the cases, COBRA allows enrollees to continue coverage for 18 months. However, if their spouses became Medicare-eligible and then left their employment within 18 months of becoming Medicare eligible, they can continue their spousal coverage with COBRA for up to 36 months from the date their spouse became eligible for COBRA.
Individuals while choosing COBRA continuation coverage have to pay the full monthly premiums for their coverage along with a 2% administrative fee. The COBRA premium is fairly expensive as people will not only pay their part but also the part that their spouse’s employer used to pay. Besides being expensive COBRA plan is also temporary. If individuals don’t become eligible for Medicare themselves within 18 months or up to 36 months depending upon their circumstances then they will have to come up with another coverage plan, as their COBRA continuation coverage will end.
Individuals can Buy Plan through their State Health Insurance Exchange
Due to the Affordable Care Act, individuals also have the option to buy a private individual health plan from their state’s health insurance exchange. Even if there is no open enrollment period when they lose their spousal coverage, then also losing the coverage will make then eligible for a time-limited special enrollment period in the individual insurance market. They will have 60 days after the loss of coverage, during which they can choose a new plan. The special enrollment period is also available if they have access to COBRA continuation of their spouse’s coverage. Individuals having low-income may also qualify for a subsidy that will help them pay their monthly health insurance premiums. Depending upon their income, individuals may also be eligible for subsidized discounts on cost-sharing charges like copays, deductibles, and coinsurance. Individuals while shopping for a health plan can apply for a subsidy.
Buy Health Insurance Privately
Individuals should also be aware that their state’s health insurance exchange is not the only place to buy an individual health plan, as individual health plans purchased outside the exchange are also completely compliant with the ACA. There are few health insurance portals operating from where individuals can easily buy health insurance. Individuals also have the option to buy a policy directly from a health insurance company. However, individuals will only be able to buy subsidized health plans through their state’s health insurance exchange.
Individuals can also obtain the assistance of an independent insurance advisor to seek advice for buying the best plan for themselves. The health insurance advisors will help them buy plan listed on their state’s health insurance exchange, or directly from a health insurance company. Thus, individuals should look for an advisor who will be able to advise them on and off-exchange options depending upon their circumstances.
Low-income individuals may also be eligible for the government-sponsored health insurance program, Medicaid. People often get confused between Medicare and Medicaid, but they need to understand that both are separate programs having different benefits and eligibility criteria. In most states, low-income individuals earning up to 138% of the federal poverty level qualify for Medicaid programs. Every year, the federal poverty level changes and in 2019 it was 138% of the poverty level that amounted to $23,335 for a couple. Individuals living in a state that has expanded its Medicaid rolls have more chances to qualify for this program compared to individuals living in a state that has not expanded its Medicaid rolls. They qualify for Medicaid only if they are low-income, disabled, or caring for a minor child. Individuals can directly apply for Medicaid with their state’s Medicaid program and their state’s health insurance exchange can also determine their eligibility for Medicaid.