Health Insurance Considerations When Changing Employers
Over the past two years, we’ve been on a rollercoaster ride in the way we work. The pandemic has been a catalyst for job and career changes. Whether you’re changing employers, working for yourself, or joining the gig economy, one of the things you need to keep in mind is health insurance coverage. Two-thirds of Americans under age 65, or about 156.5 million people, have health insurance through employer-sponsored plans. When a worker quits or is fired, the whole family can lose their health insurance overnight. What parameters should we assess to minimize coverage disruption and maximize benefits?
1. Stay on your current employer’s health insurance plan through COBRA, for up to 18 months after you leave, even if you have a new job with benefits. You have 60 days to register and must pay the full premium, which can be several times your payroll deductions.
2. Transition to a plan offered by your new employer. It is likely to be administered by a different company (eg Blue Cross Blue Shield vs. Aetna) and have a different network than your previous plan. You can choose from several levels of coverage. The premium is subsidized by the employer.
3. Enroll in your spouse’s plan, if available, through their employer. A family plan can be more profitable than two individual plans.
4. Enroll in Medicare if you are over 65. If you are not already registered with Social Security, you have eight months to register when you lose employer-sponsored coverage. You can choose the traditional Medicare plan or a Medicare Advantage plan. Medicare only covers you, not your spouse or family member, unless they are also age 65 or older.
5. If you are between jobs or starting your own business and your annual income falls below 138% of the federal poverty level ($25,268 for a two-person household), then you qualify for Medicaid in the Illinois. Medicaid offers excellent coverage with minimal cost sharing by patients, but not all providers accept the plan.
6. If you are a contract or part-time worker, your employer does not offer benefits, or the employer’s plan is not affordable with adequate coverage, you can purchase a plan in the marketplace. The government subsidy can significantly reduce your premium if your income is below 400% of the federal poverty level ($73,240 for a two-person household).
7. Similar to auto and home insurance policies, you can purchase health insurance from a broker, who is paid on commission by the insurance company. They have access to on-exchange and over-the-counter plans and can find the plan that fits your personal situation.
Things to consider
1. Continuity of care. Will your primary care provider and medical specialists still be in the network when you switch insurance plans? Will you be able to go to the same hospital, pharmacy, rehab center or therapist? Marketplace and Medicare plans allow you to check provider status online. For commercial plans, call the administering company to confirm.
2. Medical expenses to date and anticipated care needs. What medical services have you used and what will you need for the rest of the year? If you’ve already paid a large portion of this year’s deductible and maximum disbursement, continuing in the same plan (eg COBRA) means better coverage for the rest of the year than resetting the books with a new plan.
3. Coverage and cost sharing. What are the user fees and co-insurance amounts for common things like doctor visits and hospitalizations? What deductible will you pay before the insurance takes effect? What is the disbursement limit for the year? Do you use special services like allergy shots and infertility treatments? For high-deductible plans, you can benefit from a health savings account with possible employer contributions.
4. Prime. The premium can vary widely, even for employer-sponsored plans. Pick one that fits your monthly budget while still providing adequate coverage. Don’t forget that the bonus is tax deductible, unless your employer deducts it before tax from your salary.
Health is our greatest asset that allows us to explore exciting career opportunities and start new businesses. Having the right health insurance plan in place to protect ourselves and our families gives us the peace of mind to take on the next journey.
Qing Yang and Kevin Parker are married and live in Springfield. Dr. Yang received his medical degree from Yale University School of Medicine and completed his residency training at Massachusetts General Hospital. She is an anesthetist at HSHS Medical Group. Parker has helped formulate and administer public policy for various city and state governments across the country. He previously served as Group Information Director for Education at the Illinois Department of Innovation and Technology. This column is not intended to replace professional medical advice, diagnosis or treatment. The opinions are those of the authors and do not represent the views of their employers.