Health Insurance After Getting Laid Off vs. Quitting vs. Getting Fired
Exploring health insurance options can be overwhelming when you experience a job change. Whether you have been laid off, quit your job, or been fired, understanding how your health insurance coverage may be affected is crucial. This comprehensive guide dives into the different scenarios and provides insights on how to navigate the transition.
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Eric Stauffer
Licensed Insurance Agent
Eric Stauffer is an insurance agent and banker-turned-consumer advocate. His priority is educating individuals and families about the different types of insurance coverage. He is passionate about helping consumers find the best coverage for their budgets and personal needs. Eric is the CEO of C Street Media, a full-service marketing firm and the co-founder of ProperCents.com, a financial educat...
Licensed Insurance Agent
UPDATED: Nov 28, 2023
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Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different insurance companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about insurance. Our goal is to be an objective, third-party resource for everything insurance related. We update our site regularly, and all content is reviewed by insurance experts.
UPDATED: Nov 28, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We are not affiliated with any one insurance company and cannot guarantee quotes from any single insurance company.
Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different insurance companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
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What happens to insurance when you get fired or quit?
Typically, your health insurance coverage will automatically stop when you cease your employment. The specific details may vary based on your company policies, so you should discuss this matter with your human resources manager. Some companies may allow you to benefit from this coverage until the last day of the month that you quit. For others, your health insurance may end the day after you get fired or laid off.
The good news is that you can typically take advantage of a special federal law under the Consolidated Omnibus Budget Reconciliation Act, or COBRA. This law allows employees to continue taking advantage of their employer-provided health insurance whether they were laid off, fired, or quit. Workers are also eligible for COBRA benefits if the employer reduces their hours below a minimum threshold.
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Does my employer offer COBRA coverage?
Private employers must comply with this law so long as they have a minimum of 20 employees and provide group health coverage for their employees. Smaller employers may need to comply with similar rules introduced by their states. For example, Florida has the Health Insurance Coverage Continuation Act, which offers similar benefits to COBRA but applies to companies with 19 or fewer employees.
If your employer offers COBRA and you’re enrolled in its healthcare plan, it automatically applies if you have a qualifying event that causes you to lose coverage. Qualifying events include a reduction in hours, layoffs, quitting, and termination for anything other than gross misconduct. In these cases, the law requires your employer to offer continued coverage to you and your family. This coverage must be identical to what you had before leaving the job.
How long does insurance last after being terminated?
COBRA coverage is temporary and will last for 18 to 36 months, depending on the type of qualifying event. There are additional rules covering people with disabilities or offering extended protection to a qualifying spouse or dependents should the employee die during the initial period.
How much does COBRA coverage cost?
Each employee or beneficiary must pay the full premium to continue receiving COBRA benefits. If your employer paid a portion of your health plan costs before, then COBRA will likely be more expensive. Therefore, it’s good to check other alternatives before agreeing to a COBRA extension.
For example, you may be able to find an alternative through the Health Insurance Marketplace. Alternatively, it may be more economical to join your spouse’s plan. Some people choose to take short-term health insurance plans, especially if they have already lined up another position. In this case, check the levels of coverage to see if you would get the same benefits as you might through the COBRA extension.
If you qualify for COBRA health insurance after getting laid off or otherwise terminated, your former employer will send you a letter within two weeks of leaving the job. You then have at least 60 days to decide or to waive your coverage.
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When does health insurance expire after leaving a job?
Whether you quit, are fired, or are laid off, you may be able to take advantage of a COBRA health insurance extension as part of federal legislation. This will be in place for companies of a certain size, but similar state legislation may apply to smaller organizations. COBRA coverage will also extend to certain family members, but you will have to pay the full cost of the premiums. Some people may find it more cost-effective to look for other solutions, like short-term coverage or programs available through the insurance marketplace.
Case Studies: Health Insurance After Getting Laid Off vs. Quitting vs. Getting Fired
Case Study 1: Health Insurance After Getting Laid Off
John, a software engineer, experienced a layoff due to company downsizing, leaving him without employer-provided health insurance for himself and his family. He explores options like COBRA or a health insurance marketplace plan to secure alternative coverage. Considering the costs and benefits of each option, John carefully evaluates his situation to make an informed decision that suits his specific needs.
Case Study 2: Health Insurance After Quitting a Job
Emily, a marketing specialist, left her job voluntarily to become a freelancer. As she is not eligible for COBRA coverage, Emily takes on the task of finding health insurance on her own. She researches private health insurance plans, comparing their premiums, deductibles, and coverage options with marketplace plans.
Considering factors like her income, medical needs, and budget, Emily seeks the most suitable health insurance option for her new self-employed status.
Case Study 3: Health Insurance After Getting Fired
Sarah, a 42-year-old retail manager, was recently fired due to a series of workplace conflicts. Losing her job unexpectedly also means losing her employer-provided health insurance coverage. Sarah begins her search for alternative coverage by exploring options like marketplace plans, Medicaid (if eligible based on income), or short-term health insurance plans.
She takes into account her immediate healthcare needs and financial situation to make the best choice for herself and her dependents.
Frequently Asked Questions
What happens to insurance when you get fired or quit?
Your health insurance coverage will typically stop when you leave your employment, but you can take advantage of COBRA, a federal law that allows you to continue your employer-provided health insurance for a limited time.
Does my employer offer COBRA coverage?
Private employers with at least 20 employees who provide group health coverage are required to offer COBRA. Smaller employers may be required to offer similar benefits under state law.
How long does insurance last after being terminated?
COBRA coverage is temporary and can last for 18 to 36 months, depending on the qualifying event. Additional rules apply for people with disabilities and qualifying spouses or dependents.
How much does COBRA coverage cost?
Each employee or beneficiary must pay the full premium to continue receiving COBRA benefits. COBRA may be more expensive than what you paid through your employer, so it’s good to check other alternatives.
When does health insurance expire after leaving a job?
Your health insurance coverage will expire when you leave your job, but you may be able to take advantage of COBRA. COBRA coverage will last for a limited time and is available for qualifying events like quitting, being laid off, or being fired.
When will I receive a letter about COBRA coverage?
- If you qualify for COBRA coverage, your former employer will send you a letter within two weeks of leaving your job. You then have at least 60 days to decide whether to accept or waive your coverage.
Compare The Best Insurance Quotes In The Country
Compare quotes from the top insurance companies and save!
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Eric Stauffer
Licensed Insurance Agent
Eric Stauffer is an insurance agent and banker-turned-consumer advocate. His priority is educating individuals and families about the different types of insurance coverage. He is passionate about helping consumers find the best coverage for their budgets and personal needs. Eric is the CEO of C Street Media, a full-service marketing firm and the co-founder of ProperCents.com, a financial educat...
Licensed Insurance Agent
Editorial Guidelines: We are a free online resource for anyone interested in learning more about insurance. Our goal is to be an objective, third-party resource for everything insurance related. We update our site regularly, and all content is reviewed by insurance experts.