Losing Health Insurance during a Pandemic
A growing number of Americans are losing their jobs and their health insurance at a time when they may need it the most.
What can I do?
Uninsured out in the cold
The Trump administration decided to not reopen enrollment in the Affordable Care Act’s federal exchanges. This affects approximately 28 million American’s who lack health insurance. These people must wait until November 1st when open enrollment for next year begins.
Democratic lawmakers and health insurance industry leaders have been asking the administration to temporarily reopen the exchanges in a push to get the uninsured covered before the coronavirus situation gets worse.
• It was expected that President Trump would offer a Special Enrollment Period to the uninsured. Instead the administration has thrown its support behind a lawsuit filed by Republican states to invalidate the entire Affordable Care Act.
This is a strange stance to take during a pandemic. Should the Trump administration and their Republican allies succeed another 20 million people currently coverage by ACA plans could end up joining the ranks of the uninsured.
♦ Some Democratic-leaning states that run their own insurance marketplaces have already reopened enrollment in a push to get their uninsured covered. Unfortunately, the Trump administration oversees the enrollment of about two-thirds of the states.
The states that reopened their exchanges are:
Colorado, Connecticut, Maryland, Massachusetts, Nevada, New York, Rhode Island, and Washington. California was still open and has now decided to extend enrollment through June.
It is hoped that public pressure will force the President to help the uninsured.
Recently unemployed have a shot
All Americans will be frightened if they understood the cost of treatments for the coronavirus infection. People losing their insurance because their job disappeared will be in a panic.
There are some options for getting health insurance coverage.
A family member’s plan
You may be able to jump into a family member’s coverage.
If you lose your job and your health insurance, you may be able to join your spouse’s employer plan.
If you are under 26, you can be added to your parent's plan.
You need to check this out right away because some plans have a time limit.
Of course, you need to expect to pay for this coverage. But in most cases an employer sponsored plan provides better coverage than most plans on the open market.
If you are eligible, Medicaid may be a good choice.
The Medicaid program was expanded under the Affordable Care Act. Many more people may now qualify. Unfortunately, 14 state legislatures buried their heads in the sand and steadfast refused to expand their Medicaid programs.
People living in those states have the least options. People living in non-Medicaid expansion states will need to have an annual household income of at least 100% of federal poverty level to be able to receive subsidy help with an ACA plan.
For this year, it is $12,490 for a single person or $16,910 for a couple. Note: ACA subsidies are calculated based on federal poverty guidelines published for 2019.
In 36 states and the District of Columbia that did expand Medicaid, adults can get Medicaid if their income is 138% or less of the federal poverty level, which is generally $17,609 a year for an individual and $23,791 for a couple.
There are no or little out-of-pocket charges for enrollees for most services. The program covers things like doctor visits, hospital stays and drugs. Not all doctors participate, but most hospitals do.
♦ You can apply for Medicaid at any time.
Medicaid is one of the first options to consider if you just lost coverage. Many people have ingrained in them the thought that Medicaid is the same as Welfare. It is not.
Medicaid is a government program for lower-income and disabled people. It is administered by the states using both federal funds and state funds. It is a safety net that no one should be ashamed of tapping.
• Because Medicaid is administered by the states the rules vary by state.
To figure out if you are eligible and apply, you could go to your state’s Medicaid agency directly. The federal health insurance marketplace at HealthCare.gov is the better route for most people.
By using the federal marketplace, you can also find out right away if you qualify for ACA coverage, Medicaid or CHIP for your children. If it looks like you may qualify for Medicaid your application will be forwarded to your state’s Medicaid agency.
♦ The Children’s Health Insurance Program (CHIP) can help children even if their families make too much for Medicaid.
Healthcare.gov serves as the marketplace for the majority of the United States. There are 15 states including the District of Columbia that maintain their own online exchanges. If you live in one of these 15 states you will need to apply through your state’s website.
Special enrollment period
You can sign up right away for ACA coverage, without waiting for the annual enrollment period in the fall. You have 60 days after you lose coverage to do it. You will likely need to offer documentation proving that you are losing health insurance.
In most states, you will use the federal HealthCare.gov site to enroll in ACA plans. Other states have their own online ACA marketplaces.
ACA plans often have high premiums, but many people can qualify for a federal subsidy based on their income. The subsidy can bring your monthly cost way down, sometimes even to zero.
Many ACA plans also have high deductibles, so you could pay a lot of money before most coverage kicks in. Some people qualify for federal help with those out-of-pocket costs as well. This is referred to cost-sharing reductions (CSR). If you qualify for CSR, you must be sure to choose a SILVER plan.
• Many people will qualify for a subsidy so it is important to try you luck at your state's exchange.
Subsidies are available for family with incomes up to 400% of federal poverty level. For 2020 coverage, that is up to $67,640 for a couple or $103,000 for a family of four.
• For everyone with marketplace plans, coronavirus tests and screening visits will be covered without charge to the consumer, under the new law.
A bit of caution
The ACA coverage and most importantly the subsidy is based on your household’s annual income. You must estimate this for 2020. The lower your estimate the larger your subsidy.
You should try to keep track of your income. Should you end up making more than you estimated you will be expected to repay some of the subsidy your received. This is usually taken from next year’s tax refund.
If you return to work with the option to have company sponsored health insurance, you must join your company plan and notify the ACA marketplace the date you will stop. If you don’t do this you could end up having to repay a lot of subsidy money.
If you get a new job that does not provide health insurance, you should recalculate your estimated annual income and report this to the ACA marketplace. Your subsidy will be adjusted but this will save you the shock of getting a tiny refund next year.
Cobra, which stands for the Consolidated Omnibus Budget Reconciliation Act, allows you to keep your employer health insurance plan for as long as 18 months after you leave your job. You have to sign up within 60 days of losing your job-based coverage.
There are advantages to Cobra, but also a huge downside: the cost. Cobra can cost up to 102% of the full premium on your employer plan.
Most people don’t know how much that is, because employees generally only pay a fraction of that total each month. The average annual family premium for employer plans last year was $20,576, and for an individual plan it was $7,188, according to a Kaiser Family Foundation survey.
An upside of Cobra is that you can keep your current network of doctors and other health-care providers. This may be especially valuable if you are in the middle of treatment for something and changing would be disruptive.
• Cobra does not apply to all companies. Employers with 20 or more employees are usually required to offer Cobra and to notify employees about how to apply for it.
Cobra also does not apply to plans sponsored by the Federal Government or by churches and certain church-related organization.
Will testing be paid by insurance?
With enactment of the Families First Coronavirus Response Act on March 18, 2020, the federal government took action to ensure access to COVID-19 testing. The legislation requires Medicare, Medicaid, all group health plans, and individual health insurance policies to cover testing and associated visits related to the diagnosis of COVID-19 during the federally-declared emergency period.
♦ On March 13, 2020, President Trump declared a state of emergency over the coronavirus.
In addition, the new law gives states the option to provide Medicaid coverage of COVID-19 testing for uninsured residents with 100% federal financing.
• Many states have also implemented policies to increase access to COVID-19 testing and treatment, as well as continued management of other health conditions.
Some states have already indicated that they are requiring insurers to cover a COVID-19 vaccination with no cost-sharing if and when one becomes available, while others are requiring state-certified insurance carriers to waive patient cost-sharing for COVID-19 treatment, as well as treatment for other related conditions, including pneumonia and the flu.
Insurers will try to refuse to pay
The news is now reporting a number of insurance plans are trying to refuse to pay for coronavirus testing. It can be expected that some insurers will dream up schemes to justify denying a claim.
If you visited an ER before March 13th, the federal law will likely not help you. You will need to check with your insurance commissioner’s office to see if your state put in place their own policies.
• Before this virus runs its course, you can be sure new guidelines will be issued to force insurers to pay up. But in the meantime, if you get stuck with a huge bill you should never give up.
♦ You need to be persistent as always and challenge any denial.
Find out the reason for the denial and follow up with an appeal. Remember in a ‘true emergency’ your insurer cannot deny a claim simply because you used an out-of-network hospital.
Expect insurers to try to redefine the words 'true emergency' so they can deny paying because you did not test positive for the virus. A pathetic excuse that some insurance companies will surely try to use.