What to Do When Your Health Insurance Runs Out

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By Leah Ariniello
Special to The Washington Post
Sunday, June 22, 2008

Just when you thought your biggest hassle in life wouldn't amount to much more than determining whether you should watch a "CSI" rerun or a highly edited version of "Pirates of the Caribbean," change happens.

Perhaps you've graduated from college and your parents are cutting the strings. Maybe your performance review tanked and you are about to get axed from your job. Or, out of a soap opera, you uncovered a spouse's cheating ways and have resolved to give him or her the boot.

In addition to the obvious drama that graduation, job loss or divorce can bring, you find out that the life change will also cause you to lose your health insurance.

The good news? No, you can't crash on our couch until the turmoil subsides. But we do have your back on the health insurance front. Read on to find out about some options; you might be surprised at what's out there.

Option

1. GET A JOB WITH BENEFITS. Obviously, finding a job with decent health benefits is often worth the trouble. "Employers that offer good coverage by and large will pay the lion's share of the premiums on your behalf," says health insurance expert Karen Pollitz of Georgetown University. "You're probably not going to find a better deal than that."

But what if you have dreams of becoming a rock star and no singing gigs come with health benefits? Should you put your career aspirations on the back burner just to get your doctor bills covered? Jennifer Regan, 28, found a way to do both after her college graduation when she was about to get kicked off her parents' health plan.

"I got out of school and had a degree in theater production, which is lots of fun, but I needed a job that was going to give me health benefits and some stability," says the Middletown resident. Her solution was to work at Starbucks, which provides flexible hours and health benefits to part-timers. As a barista in the District, she made coffee drinks in the morning for about 20 hours a week, and in the afternoon and evening she worked contract jobs with theater companies.

If you don't have the patience for the extra-hot-skinny-half-caf-venti-latte crowd, do some more digging. Other part-timers who receive health benefits include employees at FedEx Express, the retailer REI and the crossing guards for Montgomery County Public Schools. And remember that employment-based health plans are a particular boon to people with health problems. Under the federal Health Insurance Portability and Accountability Act (HIPAA), an employer that provides health benefits generally can't deny coverage or charge you more because of poor health.

For information on HIPAA, visit http://www.dol.gov/ebsa/publications/yhphipaa.html.

Option

2. Extend Existing Coverage. If you are going to lose health coverage from an employment-based plan, either through your job, a spouse's job or a parent's job, ask if you are eligible for COBRA or state continuation coverage, which extend your coverage for a limited time while you figure out a game plan. You need to act quickly, though, because this option is on the table for a short time.

The downside? COBRA (the better-known name of the Comprehensive Omnibus Budget Reconciliation Act) and state continuation coverage can induce a severe case of sticker shock. Your employer probably paid a chunk of your premiums in the past, but with continuation coverage you'll probably have to pony up for all the premiums and an administrative fee.

For information on COBRA, call the Employee Benefits Security Administration at 866-444-EBSA or visit http://www.dol.gov/ebsa (click on " FAQs on COBRA Health Coverage").


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