If you’ve recently lost your job, whether by choice or due to unforeseen circumstances, it can be a stressful and uncertain time. One of the biggest concerns during unemployment is how to keep your health insurance. Fortunately, you still have several options to help protect your well-being, including COBRA, Medicaid, short-term plans and Marketplace insurance.

Whether you’re looking for short-term support or a more complete solution, there are ways to stay covered while you navigate what’s next. This guide walks through the pros and cons of your available options so you can make an informed decision.

Understanding Your Options

When shopping for health insurance for unemployed individuals, the right choice depends on your income, budget and medical needs.

Here are the four most common options:

COBRA Coverage

If your employer had 20 or more employees, you may be eligible for COBRA continuation coverage. COBRA allows you to keep the same insurance plan for a limited time (usually up to 18 months). Keep in mind:

• You must pay the full premium yourself, including the portion your employer used to pay
• You have 60 days to enroll after your job loss
• COBRA is not available if your employer goes out of business or ends their group health plan

This option offers consistency but can be costly, especially without employer contributions.

Short-Term Health Insurance

Short-term insurance plans are designed for temporary coverage and may work if you expect to find another job soon. However, they:

• Do not cover pre-existing conditions
• May exclude important benefits like maternity care, mental health support or prescriptions
• Often require you to reapply every few months

These plans are not Affordable Care Act (ACA)-compliant, so they’re best used only as a stopgap.

Medicaid

Medicaid is a state-based program for people with low incomes. If you’re unemployed and your income is below a certain threshold, you may qualify. Medicaid offers:

• No or very low monthly premiums
• Full coverage of essential health benefits
• Enrollment year-round

Eligibility varies by state, and you can apply through your state’s Medicaid office or through the federal Marketplace.

Marketplace Health Insurance

Marketplace plans (also called Affordable Care Act or ACA plans) are available to most people, including those who are unemployed. They offer:

• Comprehensive benefits like preventive care, prescription drugs, emergency services and maternity coverage
• Free coverage for preventive services
• Coverage for pre-existing conditions
• Pediatric vision and dental on all plans; adult vision and dental available on select plans
• Financial help through subsidies based on your household size and income

You can enroll in a Marketplace plan if you’ve recently lost job-based insurance through a Special Enrollment Period. Plans can also be canceled without penalty once you return to work and gain employer coverage.

Important Considerations When Choosing Health Insurance

When comparing health plans for unemployed individuals, it’s important to consider more than just the monthly premium. Look for a plan that offers comprehensive coverage, including care for the unexpected, and key benefits like:

• Essential Health Benefits (EHBs)
• No-cost preventive care
• Coverage for pre-existing conditions
• Vision and dental options (Marketplace plans include pediatric vision; some may offer adult dental and vision, too)

Consistent and Predictable Costs

Marketplace plans are designed to help you manage your budget with consistent monthly premiums and clear cost-sharing when you receive care.

Affordability

Based on your income and household size, you may qualify for:

• Premium tax credits to reduce your monthly costs
• Cost-sharing reductions to lower deductibles and copays

Provider Networks

Plans vary in which doctors, clinics and hospitals are included. Be sure to check that your preferred providers are in-network before enrolling.

How to Choose the Best Option for Your Needs

Choosing health insurance while unemployed depends on several key factors, including your income, healthcare needs, timing and budget. Here’s what to consider as you weigh your options:

• Check if you qualify for Medicaid or Marketplace subsidies
  Medicaid is available year-round if you meet certain requirements. Plus, most people qualify for financial help on Marketplace plans.
• Compare costs
  Look beyond just the monthly cost. Consider monthly premiums, deductibles, copays, coinsurance and the plan’s out-of-pocket maximum.
• Review plan networks
  Be sure your preferred doctors, specialists and hospitals are in-network before enrolling.
• Consider timing
  If it’s early in the year (like February), choose a plan that makes sense for the full year, especially if you think you might remain unemployed longer.
  If it’s later in the year (like October), you might:
  • Choose a low-or $0-deductible plan to get the most out of your benefits before year-end.
  • Or, if you’re healthy and don’t expect to use the plan much, pick a low-cost, high-deductible plan, knowing you can change during Open Enrollment.

For comprehensive coverage that helps protect your health and finances, the Health Insurance Marketplace is often the best fit, especially with its financial assistance and robust benefits.

Here’s a quick look at how the most common options compare:

Questions About Health Insurance Options for Those Who Are Unemployed