Health insurance tips after becoming unemployed

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PHOENIX - Losing your job is bad enough, but it's a double whammy when you lose your health insurance too.

3 On Your Side explains what to do with your health coverage once you're laid off.

If you make more than $903 per month, you won't qualify for programs like Medicaid or AHCCCS.

With the unemployed middle class growing, more people are discovering, not knowing your options can cost you.

When Sally Lockhart was laid off in February, like most jobless Americans, she had to make a decision on whether to keep her health insurance.

"I was terrified, yeah, all the sudden I had no income, I started having health problems and I had no way to pay for it," Lockhart said.

Erin Klug with the Arizona Department of Insurance said there are several ways for newly unemployed people to retain health insurance.

Option number one is Cobra.

"Cobra is a continuation of your employers benefit plan where you basically pay the whole premium," Klug said.

Cobra can be confusing, so here's what you need to know: you have sixty days to elect coverage, it lasts a year and a half from your layoff date and if you were let go between September 2008 and December 2009 the government will now pay 65% of your monthly premiums.

"That is a direct benefit for individuals and families from the economic stimulus plan," Klug said.

If you aren't eligible for Cobra your next option is an individual health insurance policy.

Everyone has the right to a HIPAA, or insurer of last resort policy, which means, regardless of health history, at least one insurer must accept you.

HIPAA policies can cost big bucks, but when it's your only option, it may be worth the money.

It was worth the money for Lockhart, who unexpectedly needed surgery just weeks after she lost her job, but because one of her payments was late her coverage was dropped.

She's trying to get reinstated, but has some advice for anyone wanting to avoid the hassle.

"Make sure you get your coverage right away, if you don't get Cobra, get something, it may seem expensive, and it may seem like you don't need it, but you don't know how long it'll be until you find a job," Lockhart said.

Lockhart's health insurance has been reinstated, but she's still battling to get all her bills covered.

If you're facing a loss of health coverage keep in mind you have 31 days to join your spouse's insurance plan.

You should also check with your professional organizations, some of them offer insurance to its members.

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