When Does Your Health Insurance Expire After Leaving Your Job?
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If you lose your job, your health coverage usually ends on your last day of work or the last day of the month depending on your company's policy. That means if you quit or you're let go on March 6 then your health insurance will either end on March 6 or on March 31 in most cases.
It's a good idea to check with your human resources representative to find out when your last day of health insurance will be. Fortunately, you have several options if you need health insurance between jobs.
How long does health insurance last after quitting?
Health insurance coverage typically lasts until your last day on the job or the end of the month.
Generally speaking, there's no major difference between quitting and getting fired or laid off when it comes to how long your coverage lasts unless you're fired under certain circumstances.
How long your health insurance will last after you quit depends on your company's policies. Consider taking a look at your employment contract or asking an HR representative or your supervisor to find out how long you'll have insurance after leaving your job.
How long does health insurance last after being laid off or fired?
Your health insurance coverage usually lasts through your last day on the job or until the end of the month if you get fired or laid off.
However, you should check with your organization since some companies may have different policies to deal with each situation.
In rare cases, your employer might continue to pay for some or all of your health insurance even after you leave a position. For example, some employers help pay for health insurance costs after you retire, also known as retiree insurance. These programs often work like Medigap plans because they help pay for the part of your Medicare bill that you're responsible for such as your deductible , copay and coinsurance .
Your company might also pay for part or all of your health insurance for a temporary period after you've been laid off, as part of a severance package. Not everyone is eligible for severance and not all severance packages help with the cost of health insurance.
Health insurance options for the unemployed
Although it's a tough time, you have multiple options if you've recently lost your job and your group health insurance coverage. It's a good idea to look closely at all your choices before you decide since picking the wrong insurance option can be costly.
COBRA
COBRA lets you keep your existing health insurance for up to 18 months for most people after you leave your job. You can qualify for COBRA regardless of whether you quit, were laid off or fired. You won't get coverage if you were fired for stealing, assault, harassment or other serious offenses, also known as gross misconduct.
COBRA (the Consolidated Omnibus Budget Reconciliation Act) tends to be one of the more expensive health insurance options available.
That's because with COBRA you're paying the full cost of your health insurance policy including the part of your health insurance bill that your old employer used to cover.
Unlike marketplace health plans, you can't qualify for health insurance subsidies with COBRA. It may be worth paying extra for COBRA in some circumstances. For example, if you're worried about losing your primary care doctor or if you want to minimize disruptions to a course of treatment.
Only state and local government groups and companies with 20 or more employees have to offer COBRA. Religious organizations and the federal government are exempt from COBRA rules, although the government has its own version of COBRA.
Some states require small businesses to offer COBRA-like programs, also known as mini-COBRA. Specific rules and eligibility requirements vary according to where you live, so it's a good idea to check your local laws if you think you might qualify.
Obamacare or Affordable Care Act (ACA) health insurance
When you lose your job, you have a few months to buy an individual health insurance plan, also known as Obamacare, off Healthcare.gov or your state's health insurance marketplace.
You can buy a marketplace plan up to 60 days before you lose your job and up to 60 days after.
Marketplace health plans usually often offer the best combination of price and quality. You may qualify for Affordable Care Act (ACA) subsidies depending on your income, which can significantly lower your monthly health insurance costs.
Obamacare plans have to offer coverage for services like maternity and mental health care, which isn't the case with a kind of coverage called short-term health insurance. You also can't be denied coverage or charged a higher rate for a marketplace plan because of a pre-existing condition.
Short-term health insurance
Short-term health insurance is more flexible than regular health insurance, but it tends to offer less coverage.
Unlike regular health insurance, you can buy short-term health insurance at any time of the year. This makes it a good choice if your special enrollment period has already expired.
Short-term health insurance is a worse option compared to marketplace health insurance in almost every situation. That's because it doesn't have to offer the same level of coverage as regular health insurance. In addition, short-term plans can deny or charge you higher rates because of a pre-existing condition.
Short-term health insurance plans also aren't eligible for marketplace subsidies and other financial assistance programs, like cost sharing reductions.
Spouse's health insurance
Adding yourself to a spouse's policy is one of the easiest ways to get health insurance if you've recently lost yours. Since losing your job counts as a qualifying life event, you won't need to wait until open enrollment period to get on your spouse's health plan.
Keep in mind that while it may be an easy way to get health insurance, your spouse's plan may not be the cheapest option. Carefully consider all of your options before choosing which health coverage to go with.
Parent health insurance
If you're under the age of 26, you can get coverage through a parent's health insurance. Keep in mind that your parent may have to pay extra for this. However, the cost of adding you to their policy will usually be less than the cost of buying stand-alone insurance for yourself.
Some states have raised the age that you can stay on a parent's health insurance as an adult. For example, in New Jersey, it's possible to keep your parent's coverage until you're 31 if you're a state resident, unmarried, childless and you don't have other health insurance.
Medicare and Medicaid
Medicaid is a type of government-run insurance for people who earn a low income. In most states, you'll qualify for Medicaid if you make roughly $20,783 per year as a single person or $43,056 as a family of four.
However, if you live in one of the 10 states that don't have expanded Medicaid, you'll need to meet certain eligibility requirements besides having a low income before you can sign up. These states typically only let you sign up for Medicaid if you have a low income and you meet one of the following conditions: You're pregnant, a parent to a minor child or you're disabled. [/panel]
You can dual qualify for Medicare and Medicaid if you meet the eligibility requirements for both programs. Dual qualifying can further reduce the amount of money that you pay out of pocket for medical care.
Medicare: Good for senior citizens
If you're 65 or older, you can apply for Medicare, a type of government-run health insurance. Original Medicare consists of Part A (hospital insurance) and Part B (medical insurance). Most people only have to pay $174.70 per month for Medicare Part B because you pay for Medicare Part A through taxes while you're working.
You can also buy a Medicare Advantage plan which often includes extra benefits like prescription drug coverage, wellness programs and vision and dental insurance. Medicare Advantage plans are run by private companies, and they may charge an extra monthly rate on top of the $174.70 that you pay for Part B coverage.
Frequently asked questions
When does your health insurance expire after leaving your job?
Health insurance benefits typically go away either after your last day on the job or at the end of the month. However, this is specific to the workplace and the only way to know for sure is to ask a company representative such as an HR associate or your boss.
Can I get COBRA if I quit?
Yes, you can get COBRA if you quit, were laid off or were fired. In addition, you may qualify for COBRA if your employer lowered your hours to the point that you no longer have workplace health coverage.
However, you might not be eligible for COBRA if you were fired for gross misconduct which includes activities like stealing and assault.
Is there a grace period for health insurance after termination?
Some companies let you keep your health insurance until the end of the calendar month after being let go. So, if you were let go on January 1 then you would potentially be covered through January 31.
Sources and methodology
Information regarding COBRA eligibility rules and requirements is from the U.S. Department of Labor (DOL). Guidelines for retiree insurance came from Medicare.gov.
Editorial note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.