Though the Affordable Care Act has made it easier to get a life insurance, maintaining the cover has turned out to be a bigger challenge. A number of people have become defaulters and many more are struggling to pay the premiums month after month. The stats reveal it all; out of the 11.7 million Americans who signed up for a health insurance during the latest open enrollment season, nearly 13 percent even failed to make the first month’s installment. The figure is likely to go up in the years ahead because with jobs shrinking and salary remaining unchanged, monthly premiums have become a burden for a large section of the population. A significant percent of the population are now exposed to the possibility of cancellation of coverage due to late payments.
Yes, being insured by your employer helps, as it makes the task of paying premiums easier — the amount will be automatically deducted from your salary. But you will be stuck with the same plan until a qualifying life event — having a child, getting divorced or getting married — or until open enrollment. But in case you opt for private health insurance you must always have a contingency plan ready. This is because a spike in expenses or a fall in your income level can expose you to the risks of being uncovered.
What if you find yourself in a position where you can’t make any further payments? You can weather the storm if you know how you to bail yourself out.
Needless to say, once you stop making payments you will lose your coverage. But the time frame within which you will lose your cover may vary depending on the eligibility to seek tax credits on your installments.
In case you make the cut to get assistance on your premiums, you will be given 90 days grace period to get back on your feet. If you still fail to recover, your policy will be cancelled. During this 90-day grace period things would stand very much in your favor. Firstly, your insurer cannot decline to make the payment of claims made by you within the first 30 days after your due date. Secondly, your claims after the first 30 days will be on hold until you clear the bill. Your claims will be processed only after you clear the bill, else you’ll end up losing your insurance cover. However, if you are not eligible for assistance on premiums and fail to make the payment, your policy will be terminated after the first 30 days.
That is not it! You will also be penalized for losing your cover. Yes, you will have to pay for going without insurance, unless you are exempted. You get an exemption only if your income is so low that you don’t file a tax return, or in case if you have filed for bankruptcy or incurred significant medical debt.
The Way Out
Losing an insurance cover is a hefty blow, but it is not the end of the road. There are certain things that you can do to get back on track and here is a quick look at them-
Apply for assistance: If you are unable to make the payment due a drastic fall in your income or a change in your family situation, don’t lose hope. You may still be eligible to opt for Medicaid, or your children may qualify for the federal Children’s Health Insurance Program. Hence opt to check for your eligibility at state exchange or local Medicaid office.
Prepare: Going without health insurance is a big risk, but sometimes you may be left with no other option than to live with that risk. In such a situation, opt for a strategic medical service before you miss your premium or within the first 30-day grace period.
Plan for open enrollment: Open enrollment period is the best time to shop for plans. Hence whenever you lose your cover, opt to stay low and wait for the next open enrollment season. And when it is time, select a plan that best suits your need.