How to Get Insurance When You’re Unemployed

While the unemployment rate has been declining since it peaked in April of 2020, 5.8 percent of Americans are still struggling with joblessness. And many adults don’t have enough stashed away to comfortably get through a period of unemployment. In fact, 36 percent of Americans wouldn’t be able to cover a $400 emergency expense without borrowing money or selling belongings. If you lost your job and the benefits that came with it, another concern is getting health insurance while you’re unemployed. The good news is, you may qualify for reduced cost or free health insurance based on your unemployment status.

Health Insurance for the Unemployed

COBRA

If your unemployment is temporary or you want to keep your current health plan, COBRA continuation coverage is one option. The Consolidated Omnibus Budget Reconciliation Act requires employers with 20 or more employees to offer temporary continuation of group health coverage to employees who are terminated or have their hours reduced. Only employees fired for gross misconduct may be excluded.

Medicaid

If you’re not earning any income, you may be eligible for Medicaid, which is a low or no-cost health insurance program. Federal law requires that states provide Medicaid coverage to low-income families, eligible pregnant women and children, and people getting Supplemental Security Income (SSI). Certain groups, such as people who are blind or have disabilities, can qualify without meeting the income requirements. Eligibility requirements vary by state, except in states that have adopted expanded Medicaid. In expansion states, individuals with household incomes below 138 percent of the federal poverty level are eligible for Medicaid based on income alone. If you’re unemployed and not receiving income, it’s likely that you’ll qualify for Medicaid.

CHIP

The Children’s Health Insurance Program provides coverage to 9.6 million eligible children. If you’re not eligible for Medicaid, your children may still be eligible for CHIP. Children qualify if they are under 19 and don’t have health insurance coverage. The program is designed to provide coverage for children with family incomes too high for Medicaid. If you were deemed ineligible for Medicaid but you can’t afford private coverage, your children may be eligible for CHIP. Some states have also opted to provide coverage to pregnant women under CHIP, and some states also cover lawfully residing children and pregnant women who might otherwise not be eligible.

Marketplace Subsidies

If you’re unemployed but are ineligible for Medicaid in your state, you may be eligible for a Marketplace plan with advance payments of the premium tax credit (APTC). Adults with household incomes between 100 percent and 400 percent of the federal poverty line can qualify to apply the tax credit to their monthly health insurance premiums to save money. If you lost your job and your group health insurance coverage but are still receiving income from another source, a Marketplace plan may be your best option.

Community Health Centers

If you lost your healthcare coverage and are dealing with a health concern, there are community health centers that can offer care with sliding scale costs based on your income. You shouldn’t forego care just because you’ve lost your group coverage. If you delay addressing your health issues, you may incur a greater cost later on.

Other Steps to Take if You’re Unemployed

Apply for Unemployment

Eligibility requirements for unemployment vary by state, but you’ll generally need to have lost your job through no fault of your own. The amount of benefits you receive will depend on your previous earnings. It can take up to six weeks to start receiving payments, so you should apply as soon as you lose your job.

Establish a Schedule

Keeping a routine can help you stay positive and productive. Schedule a block of time each day to search and apply for jobs. You might also consider taking a course to become more knowledgeable in your industry. Fill the rest of your day with activities you enjoy or tasks you’ve been meaning to accomplish.

Apply for Jobs

With your free time, you can apply for temporary side hustles, freelance work, and jobs in your industry. Update your resume and write a personalized cover letter for each application. CareerOneStop is a good place to start searching for jobs, and you can also use one of the many freelance platforms out there to advertise your skills.

Reevaluate Your Finances

Now that you’re not earning income, you’ll want to reevaluate your budget. It’s a good idea to initiate a spending freeze during periods of unemployment. That means cutting all spending that isn’t completely necessary. You’ll still want to keep up with your rent or mortgage payment, pay your utility bills, and make the minimum payments on your debt. But you should look for ways to save money on groceries and avoid dining out.

FAQ

Which States Have Adopted Expanded Medicaid? 39 states, including Washington, D.C., have adopted expanded Medicaid. States that opted out include Alabama, Florida, Georgia, Kansas, Mississippi, North Carolina, South Carolina, South Dakota, Tennessee, Texas, Wisconsin, and Wyoming. What Is the Difference Between Medicaid and Medicare? Medicare is designed to provide coverage to seniors ages 65 and up and people with disabilities, regardless of their household income. Medicaid is a joint federal and state program that is designed to provide health coverage to low-income families. You may be eligible for both programs. How Can I Get Cheap Health Insurance without a Job? If you have no job and no other sources of income, you’ll likely be eligible for your state’s Medicaid program. That means you’ll be able to get free or low-cost health insurance while you’re unemployed. What if I Can’t Afford Health Insurance? First, check to see if you’re eligible for Medicaid. If you’re not, you may be able to afford a high-deductible health plan through the Marketplace or join a membership organization to get a group rate. If those options aren’t available to you and you plan to forego health insurance, see if you qualify for a fee exemption.