How to Get Health Insurance When Unemployed

You may think that the only way you can get affordable health insurance is by having a traditional job with a big company that offers benefits.

We can tell you that’s not the case. Whether you’re self-employed, like a handyman or freelancer, or unemployed after last year’s economic downturn, there are insurance plans for you — and they’re affordable plans, too.

We can help you find the best plan for your needs. As a national health insurance marketplace, KindHealth offers a different variety of plans including Healthcare.gov, as well as private insurance plans for all individuals who are unemployed, self-employed, or independent contractors known as 1099 workers.

What health insurance options are available for unemployed, self-employed, and 1099 workers?

Options for unemployed individuals

If you’re unemployed, you can get an affordable health insurance plan via KindHealth, which partners with Healthcare.gov and offers their same marketplace options. Your savings are based on your income and household size. You may also qualify for free or low-cost coverage through Medicaid or the Children’s Health Insurance Program (CHIP).

If you had health insurance coverage at work, but you were then fired or let go, COBRA may be an option for you. COBRA is a continuation of your health coverage, established by a federal law that requires employers to let former employees continue their healthcare plan for up to 18 months after they lose their jobs. Although most states have similar plans for smaller employers, COBRA generally only applies to companies with 20 or more employees. With a COBRA plan, you’ll keep the same coverage and provider network as you once had. Under the law, you pay 35 percent of the health insurance plan’s premium cost, and your employer pays the rest — meaning you pay only about one-third of the plan’s cost.

Options for self-employed individuals

For those considered self-employed, you can use the KindHealth marketplace to enroll in flexible, high-quality health coverage that works well for people who run businesses with income but don’t have employees.

For example, anyone can enroll if they’re a freelancer, consultant, independent contractor, or self-employed worker. However, if your business has even one employee other than yourself, you’ll have to use the SHOP marketplace offerings for small businesses to offer coverage to yourself and your employees.

Options for 1099 workers

People who work as consultants, contractors or freelancers often are called “1099 workers,” because the companies that hire them use IRS Form 1099 to report their pay. And it’s important to note that as a 1099 employee, you do in fact have potential access to healthcare options.

As freelance or contract workers, they are eligible to use the Health Insurance Marketplace to find coverage. In addition, many companies that hire contractors offer health care, dental, vision and other benefits to 1099 workers. It’s up to the freelance worker to inquire about these benefits at the start of the interviewing process to find out if any group supplemental insurance is offered, or whether they can purchase additional dental and vision plans.

There are other options to consider when facing unemployment and loss of healthcare coverage. If you’re married and your spouse is employed, it may be worthwhile to discuss the advantages and disadvantages of simply joining your spouse’s healthcare plan. If you’re 65 years old and older, another option is signing up for Medicare.

How to determine eligibility for health insurance

When deciding which healthcare option is right for you, you can estimate your income for the current year that you’re applying for healthcare. Understandably, it’s hard to predict your income for the year if you’re currently unemployed. However, it’s important to make your best estimate based on all current or expected sources of income.

For example, you should note any unemployment compensation you collect, household members’ income, withdrawals from 401ks and Roth IRAs, as well as additional types of income like capital gains, alimony, and cash support.

Once you determine your estimated income for the year, your healthcare options depend on your stated income. You may qualify for premium tax credits and savings on deductibles, copayments, and other out-of-pocket costs based on your income.

Medicaid is at your service if you have limited income or a disability. Fortunately, many states have expanded their Medicaid service coverage to all people below a certain income level. You may also qualify for CHIP, which provides coverage for children, pregnant women in some states, and families with incomes too high for Medicaid (but too low to afford private insurance).

How to enroll in a health insurance plan

If you still lack coverage, have low income, or are unemployed, it’s not too late to apply. You can now enroll in health coverage through August 15, 2021, by filling out an application with KindHealth.

If you qualify for a Special Enrollment Period due to a life event like losing other coverage, getting married, moving, or having a baby, you can enroll at any time. Also, if you happen to qualify for Medicaid or CHIP, you have the chance to apply for the program at any time.

KindHealth can help determine your subsidy eligibility. Anyone can enroll in any Healthcare.gov plan via the KindHealth platform. Discover the same plans at the same price, but with a better user experience.

How quickly does insurance coverage set in?

Once you complete your application and effectively enroll in a plan, you must pay your premiums directly to the insurance company. Coverage won’t officially start until you pay your first premium payment.

Understanding health plan deductibles

Although health insurance is a necessity, it can often be confusing, especially when understanding deductibles for different coverages and plans. In general, a deductible is the amount of money you must pay for covered healthcare before your insurance plan covers the rest of the costs.

For example, let’s say your deductible is $500. When visiting a doctor or healthcare provider, you must pay the first $500 of the service yourself before your insurance company can cover the rest.

Once you pay the deductible cost, you’re then only tasked with a copayment for the covered service, and your insurance company covers the rest. For ACA plans (found on KindHealth), all health plans pay the cost of various preventative benefits before you meet your deductible. On the other hand, some plans offer separate deductibles for certain services, such as prescription drugs.

When choosing a plan that’s right for you and your household, it’s important to note that plans with lower monthly premiums often have higher deductibles and vice versa.

Unemployed and need health insurance? Get a free quote with KindHealth

At KindHealth, we’re helping thousands of Americans with traditional or individual health plans get health insurance, save on prescription medications, and reduce their medical expenses. Get a free quote today!

KindHealth is an AI-powered national health insurance marketplace that takes the complex health insurance processes and simplifies it. We offer health, dental, vision, cancer, accident, Medicare, plus many more.

We also offer other value-add products like prescription discount cards and medical bill negotiation, all in a digital AI-powered marketplace that includes 250+ insurance carriers and Healthcare.gov plans.