Health Insurance for individuals and Families
Health Insurance Options for Recent Grads
Just graduated from college? Medicoverage has compiled 8 health care options for recent graduates.
1. No Health Insurance
This is no longer an option. Unless, you like paying for something you don’t get to use. As of 2014, the Affordable Care Act includes an individual mandate that states that nearly all Americans must purchase health insurance or pay a penalty of $95 or 1% of your income, whichever is greater. There are a few exceptions to the ACA’s mandate, such as financial hardship. If you’re considering opting out, consider these facts:
- 12 million people are rushed to the emergency room each year for accidents. Over 22% of all injury visits to emergency rooms are by otherwise healthy individuals with sports related injuries.
- The average hospital visit can cost 5 times as much for someone without insurance as it does for the big medical insurers like Aetna or Blue Shield. An uninsured patient might be charged $14,000 for an appendectomy, while an HMO with big bargaining power might be billed only $2,500 for the same operation.
- According to a study published by the American Journal of Medicine, 62% of all personal bankruptcies filed in the US in 2007 were related to excessive medical bills.
Realistically, having no insurance is not an option. Even Jonny Knoxsville has health insurance.
Medicaid is a state/federal health insurance program for individuals with a low income and few-to-no assets. The Affordable Care Act attempted to expand Medicaid to 138% of the poverty line in 2014, however many states blocked the expansion in their state. Due to each state handling Medicaid differently you would want to check with http://cms.hhs.gov/medicaid/ to see if you qualify. Don’t get Medicaid confused with MediCare. MediCare is the Federal health insurance program for Americans age 65 and older and for certain disabled Americans. While Medicaid covers children, the elderly (too), people who are blind and/or disabled, and people who are eligible to receive federally assisted income.
Pros: It’s free.
Cons: Qualification parameters are limited to the disabled and those with extremely low-income levels and are strictly enforced. Don’t try to cheat this system - it’s extremely bad karma.
3. Free Clinics
Most urban areas have local clinics that offer low-cost or even free medical care including routine doctor visits, STD, and HIV testing. Services vary by clinic - check your local phone directory for a list of clinics near you. A free clinic, however, does not function like an emergency room, and therefore cannot help you if you’ve blown out your ACL playing touch football with your nerdy friends on Thanksgiving. Free clinics also generally do not offer major surgery, hospital stays, or long-term care.
Pros: It is low-cost, and may even be free.
Cons: Clinics do not function as full-fledged hospitals, nor do they allow patients to choose their own doctor. Also, bring something to read - you’ll be there awhile. And more than likely you’ll be paying a penalty to the IRS and still waiting and paying out of pocket a lot if you have an emergency.
4. Mom and Dad
Great news for you, the ACA allows children up to 26 to stay on their parents health insurance plan. You don’t have to be a full-time student to qualify either. However, you might be able to find a less expensive plan on your own, especially if you qualify for either or both of these subsidies:
- Premium Subsidies: to help cover monthly policy costs Cost-Sharing Subsidies: to help with the cost of your deductible, copay, and coinsurance
5. New Employer
The ACA steps in here, too. As of 2015, employers with 50 or more full-time equivalent employees must offer health insurance or pay a penalty. Many full time jobs offer health insurance benefits as part of your total compensation package. But check with your human resources contact and read your offer letter closely—some companies require that you be employed for up to six months before their health coverage kicks in (this changes to a 90 day max in 2015, including holidays and weekends).
Also make sure you understand the status of your employment with this new company. With the economy the way it is, many firms are forced to cut costs by hiring new employees on a “consultant” basis. If you are hired on as a “consultant” rather than as a full-time employee, your new employer may not be obligated to offer you health insurance. Ask the HR division of your new company how they handle benefits.
Pros: Many employers offer multiple, high-quality health plans to choose from. Often these plans offer excellent comprehensive medical coverage. Also, your contribution is taken directly from your paycheck for minimum hassle and maximum benefits.
Cons: Mandate doesn’t start to 2015. So get individual coverage till then if your company doesn’t offer insurance currently.
6. Short-term health insurance
As of 2014 this probably won’t be necessary for anyone, since all new qualified health plans must guarantee issuance regardless of a preexisting condition. But if for some reason you find yourself in this spot, or you want insurance now, some insurance companies sell short-term coverage that allows you to be covered anywhere from 1 to 12 months. Short-term health insurance usually does not cover any previous medical conditions so read the fine print. Short-term insurance has a “daily option” which allows you to select the exact amount of days you want to be covered. For instance, you would not be charged for two whole months if you only need 45 days of medical coverage. This might be a great solution for someone who needs temporary coverage until his or her work medical plan kicks in.
Warning: Usually there are no refunds or changes once a short-term policy is in force and you must pay the whole amount in full if you go for the daily option. Before you go with short-term coverage, compare it with an individual coverage plan (#7 below). Sometimes individual coverage is less expensive, more comprehensive and easier to cancel. Remember short-term insurance is not renewable.
7) Individual Coverage
There are three options before the first of the year:
- Traditional Health Insurance: Plans that are available now. These plans check your medical history and may deny you due to a preexisting condition. However, these plans usually have lower monthly premiums than signing up for an ACA plan. The traditional plan will allow for you to stay on this plan until Dec 2014. Besides saving some dough, you also get to see how the new plans work before committing.
- ACA Metal Plans: a href=“http://www.medicoverage.com/health-insurance-blog/news/comparing-exchange-plans-bronze-silver-gold-platinum”>Bronze, Silver, Gold, and Platinum plans. These plans must include the essential health benefits such as prescription drugs and maternity, guarantee issuance, and must cover a minimum of 60% of your health costs. Coverage for these plans begin January 1, 2014.
- Off-Exchange Plans: These are plans available outside of the Health Insurance Marketplace, must cover all the essential benefits, but do not qualify for subsidies. Why would you choose this? For a few reasons: If you know you don’t qualify for subsidies you may plans that have lower monthly premiums, as well as it saves time and protects your personal information by not having to fill out all the paperwork the feds/states require to see if you qualify for those subsidies.
Next Steps? Visit our How to Choose a Health Insurance Plan page and then get a quote with the tool at the top of the page.
With the ACA you’re probably not going to need COBRA (at least not for any long period), but let’s get into it anyway. While sounding like a bad heavy metal band, COBRA actually stands for Consolidated Omnibus Budget Reconciliation Act. COBRA was designed so that individuals who leave their jobs (or get fired) can still purchase the same insurance policy that they had with their previous employer. With the new Affordable Care Act there are special enrollment periods if you lose your job , so you don’t have to worry about COBRA. The only way you’d need COBRA is if you were fired or quit without notice.
Next Steps? If you want more information about health plans call 80-930-7956 or contact Medicoverage.