Health Insurance:
Frequently asked questions

I lost my job — and my health insurance — when my employer went bankrupt. Can I get COBRA?

When your employer went out of business, the group health insurance pool to which you belonged also ended. You're not eligible for COBRA coverage because there is no longer a group under which you could continue your group health insurance benefits.

Likewise, if you had already left your employer, enrolled in COBRA, and then your employer went bankrupt, your COBRA coverage would end.

However, some states have adopted their own laws, sometimes known as "mini-COBRA," that grant broader rights in determining eligibility for continued health insurance coverage. Check with your state insurance department to find out if you are entitled to continued health care benefits under a state COBRA plan.

Keep in mind, though, you must have been covered under an employer's health plan to be eligible for COBRA. If your employer doesn't offer health insurance, has less than 20 employees, or offers health insurance to only certain groups of employees (to which you don't belong), you won't qualify for COBRA benefits.

If your employer goes bankrupt, you can obtain new health insurance by:

• Finding another group health insurance plan through an employer, trade group, or alumni association.
  A note of caution: Don't let more than 63 days elapse before securing other group coverage. A break in coverage of more than 63 days severely diminisheyour rights to coverage under HIPAA.

• Obtaining individual health insurance. This is easier if you are young and healthy.

• Enrolling in Medicaid if you meet income eligibility guidelines and have children.

• Joining a high-risk health insurance pool. If your state has a high-risk health insurance pool, you may be eligible to join if there is a chronic or serious pre-existing health condition — such as asthma, depression, diabetes, or high blood pressure — that prevents you from obtaining an individual health insurance policy. Most states require you to apply and be declined for individual coverage to be considered for the high-risk pool.

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