Losing Your Health Insurance Because Your Spouse Is Getting Medicare?

Health Insurance Options When Your Spousal Coverage Ends

If you're losing your spousal health insurance coverage because your spouse is going on Medicare, you don't have to worry. You have lots of options for replacement coverage. Image © Jamie Grill/Getty Images

If your health insurance coverage comes through your spouse’s job, you may lose that coverage when he or she goes on Medicare. Not so long ago, this was a scary and expensive prospect, but things have changed. Now you have several options for health insurance if you're losing your health insurance because your spouse is getting Medicare.

Your Own Job-Based Health Insurance

If you have a job that provides health insurance but you've chosen to waive that health insurance, you’ll be eligible for a special enrollment period at your workplace.

This will allow you to enroll in your own job-based health insurance even though it’s not open enrollment for anyone else. Special enrollment periods are time-limited, usually 30-60 days, so don't wait too long. If you miss it, you'll have to wait until the next open enrollment period to sign up.

COBRA

If your spouse’s health plan is subject to the COBRA law, you’ll be eligible to continue your current health plan for 18 months through COBRA continuation coverage. Learn which health plans are subject to COBRA and who is eligible in “Am I Eligible for COBRA Health Insurance?

If you choose COBRA continuation coverage, you’ll have to pay monthly premiums. These will be larger than the premium that used to come out of your spouse’s paycheck for health insurance. With COBRA, your spouse’s employer is no longer paying part of your health insurance premium each month. You’ll pay the part you’ve always paid as well as the part your spouse’s employer used to pay.

You’ll also pay a two percent fee each month.

Not only is COBRA kind of expensive, it’s also temporary. If you’re not going to be eligible for Medicare yourself within 18 months, you’ll have to come up with another plan for coverage when your COBRA continuation coverage runs out.

Buy Health Insurance on Your State’s Health Insurance Exchange

Thanks to the Affordable Care Act, you can buy a private, individual health insurance policy on your state’s health insurance exchange.

If your health insurance exchange isn’t having open enrollment when you lose your spousal coverage, don’t worry. Losing that coverage will make you eligible for a time-limited special enrollment period on your health insurance exchange.

If you have a modest income, you may be eligible for a subsidy to help pay your monthly health insurance premiums. If your income is low, you may be eligible for subsidized discounts on cost-sharing charges like deductibles, copays and coinsurance. Apply for the subsidies with the exchange as you’re shopping for health insurance. Learn more about health insurance subsidies in:

Buy Health Insurance Privately

Your state’s health insurance exchange isn’t the only place you can buy an individual health insurance policy. For example, you can buy a policy through a private health insurance exchange like eHealthInsurance.com.

You can also buy a health insurance policy directly from a health insurance company. However, in some states, you won’t be able to get subsidized health insurance unless you get a plan from your state’s health insurance exchange.

You can use an independent insurance agent to advise you and help you buy health insurance. Many, but not all, insurance agents are able to help you buy a plan listed on your state’s health insurance exchange.

Whether you buy a plan privately or on your state’s health insurance exchange, insurance companies are no longer allowed to charge you more because you have a preexisting condition or health problem.

Medicaid

If your income is low enough, you may be eligible for government-provided health insurance through Medicaid. In some states, the Medicaid program goes by another name like SoonerCare in Oklahoma or Medi-Cal in California. It’s easy to confuse Medicaid and Medicare, but they're separate programs with different benefits and different eligibility criteria. Learn the difference.

In many states, low income people making up to 138% of federal poverty level are eligible for Medicaid. Federal poverty level changes each year, but in 2015, FPL for a couple is $15,930, more if you live in Alaska or Hawaii. If you live in a state that expanded its Medicaid rolls in accordance with the Affordable Care Act, you’ll likely be eligible for Medicaid if your family of two has an income up to about $21,980 per year.

If you live in a state that chose not to expand its Medicaid rolls, the rules for Medicaid eligibility will be more complicated. In addition to stricter income guidelines, eligibility rules may include a measurement of your overall wealth and assets. Eligibility may be limited to members of qualifying groups such as the disabled, pregnant, blind, parents of young children, or the elderly.

You can apply for Medicaid directly with your state’s Medicaid program. Your state’s health insurance exchange can also determine if you’re eligible for Medicaid. Learn about Medicaid and who’s eligible in your state.

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