What Should I Do When My COBRA Coverage Is About To Expire?

When your COBRA coverage expires, you will qualify for a special enrollment period to sign up for a marketplace ACA health insurance plan. There are also other options, such as Mira. The Consolidated Omnibus Budget Reconciliation Act, or COBRA, allows for great flexibility to find other health insurance options and ensure you have health coverage. 

COBRA Expiration

COBRA coverage is a perfect bridge between old and new coverage. While temporary, you can stay on your COBRA for approximately 18 to 36 months in most circumstances. You can initiate COBRA after voluntary or involuntary termination. The length of time that you have COBRA coverage depends on the type of qualifying event that made you eligible in the first place. 

After your COBRA expires, you must sign up for coverage as soon as possible. To obtain an ACA plan, you will have 60 days to enroll after losing COBRA. Suppose your COBRA coverage expires outside the open enrollment period. In that case, you must confirm your qualifying life event (QLE) and special enrollment period. You can do this by signing in or up to your state's health insurance marketplace. You may need to verify the QLE by sending documents; instructions will be given after submitting your marketplace application.

Coverage Options After COBRA Expires

What are your options once COBRA expires? You can look at the Health Insurance Marketplace or an option like Mira, which will allow you still have health benefits.

Health Insurance Marketplace (HMI)

Marketplace plans are a viable option after your COBRA runs out. Luckily, when your COBRA coverage expires, it counts as a qualifying event for a special enrollment period. The special enrollment period allows you to qualify for coverage after the ACA Health Insurance Marketplace open enrollment period has closed. You must have a qualifying event (QLE) to obtain insurance during this time, and losing employer-sponsored health insurance is a QLE.

It is important to note that if you end your COBRA coverage early, you will not qualify for a special enrollment period. The table below lists three possible scenarios during and outside the marketplace open enrollment period. 

Can You Change from COBRA to a Marketplace Plan?

Source: Healthcare.gov

Health insurance plans in the marketplace, or healthcare exchange, are plentiful. Most states operate out of the federal marketplace, as found on healthcare.gov, but some states have their own exchange. These states have their website separate from the federal site; you will browse and select plans from that respective website. These states include:

• California
• Colorado
• Connecticut
• District of Columbia
• Idaho
• Kentucky
• Maine
• Maryland
• Massachusetts
• Minnesota
• Nevada
• New Jersey
• New Mexico
• New York
• Pennsylvania
• Rhode Island
• Vermont
• Washington

The open enrollment period for ACA plans opens November 1st and will run until January 15, 2023. However, some states with their exchanges may have slightly different open enrollment periods. There are many different methods of applying for a marketplace plan. These include:

• Applying online through the official federal website Healthcare.gov
• Applying through a Certified Enrollment Partner.
• Contacting the Marketplace Call Center and apply over the phone
• Mailing in a paper application
• Using local help to get assistance with your application

In either case and by whichever method is preferred, signing up for an ACA Marketplace plan can be done by following the steps outlined in this Mira article and simplified below:

Step 1 - Gather the Required Information

Step 2 - What To Consider When Browsing Plans

Step 3 - Pick the Best Plan For Your Health Needs

MIRA

Mira is also an extremely viable option, as there is no set period to enroll. You can apply at any time. However, it is essential to remember that Mira is not health insurance but rather an alternative - a health membership plan. Mira offers affordable, high-quality health services. For an average of $45 a month, as a Mira member, you can access low-cost urgent or virtual care, up to 80 percent off medications, and same-day lab testing. We offer month-to-month, 6-month, or year-long plans, with affordable options to pair with a catastrophic health insurance plan.

What is COBRA?

The Consolidated Omnibus Budget Reconciliation Act, otherwise known as COBRA, is a law that allows workers and their families to continue using group health benefits from their previous employer-sponsored plan for a limited amount of time when unexpected circumstances arise. COBRA is available to qualified beneficiaries on an employer group health plan for at least one day. The business also has 20 or more full-time workers. Multiple events can qualify you for COBRA coverage; these include:

• Sudden job loss (voluntary or involuntary)
• Transitioning between jobs
• Death
• Divorce
• Certain life events
• Reduction in working hours

COBRA Benefits

There are many benefits to utilizing COBRA, a significant one being its flexibility in finding new health coverage. Other COBRA benefits include:

• Continuity in Coverage
• Coverage for Dependents
• No Lapses in Coverage
• Lots of Time to Enroll

Signing Up For COBRA

After your last day of work, your employer will have 45 days to inform you about enrolling in COBRA. If you miss this window to sign-up, you will likely have to wait for up to 10 months for the next open enrollment period. This is why you must plan to have options and health coverage once your COBRA expires.

Ways To Make Insurance More Affordable 

For ACA plans found on the marketplace, there are two great options to make insurance more affordable. If you are eligible, these are Premium Tax Credits and Cost-Sharing Reductions. 

When you apply for coverage, you will find out if you qualify for a premium tax credit. The credit amount will depend on your estimated household income for the year you apply for coverage. You can use this tax credit on your monthly insurance bill. Cost-sharing reductions will lower the total amount you pay for deductibles, copayments, and coinsurance. If you qualify, you must enroll in a silver plan to utilize cost-sharing reductions.

COBRA Expiration Frequently Asked Questions (FAQs)

Consider this additional information regarding your COBRA coverage expiring.

Are There Any Other Circumstances In Which I Am COBRA Eligible?

COBRA coverage may also be offered to children who no longer have dependent status or retirees who do not yet qualify for Medicare. Aging out (turning 26) of your parent/guardian’s health insurance plan makes you eligible for COBRA for 36 months. Group health plans are expected to notify the employee covered and their dependents of their COBRA rights.

What If I Choose Not To Take On COBRA Coverage?

You can apply for a marketplace plan if you decide not to enroll in COBRA coverage. Just because you are eligible for COBRA does not mean you must use it. Losing your job-based coverage qualifies you for a special enrollment period. You can then enroll in a marketplace plan should you not enroll in a COBRA plan.

Is COBRA or an ACA Plan More Affordable?

Marketplace plans tend to be cheaper and best for those trying to cut costs. However, COBRA is an excellent option for those with preexisting medical conditions or who have already met their annual deductible. ACA plans also tend to be more affordable as you can be eligible for government subsidies, drastically lowering your monthly health insurance payments. 

Bottom Line:

When your COBRA coverage expires, it is best to search for marketplace or short-term health plans, such as Mira. COBRA expiration qualifies you for a special enrollment period to enroll and receive coverage through your state’s or the federal healthcare exchange. If you lost coverage during the open enrollment, you will sign up using the respective marketplace and not need to verify the need for your special enrollment period. 

Losing COBRA coverage can be stressful. Luckily, Mira can provide a good coverage option for affordable health care in the short and long term. Mira offers primary coverage, including $99 urgent care visits, up to 80% off over-the-counter prescription costs, and same-day lab testing, all for an average of $45 per month. Sign up today to get instant health benefits.