Laid Off? 10 Health Care Tips

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From COBRA to Private Health Insurance to Coping With Stress, Here's What to Do

By Miranda Hitti
WebMD Health News

Dec. 15, 2008 -- With the markets roiling and the ranks of the unemployed growing, it's time to take a cold, hard look at a worker's worst-case scenario: being laid off.

If it happens to you, and you had health insurance through your employer, what are your options now? And what about the toll that losing your job can take on your physical and mental health?

Here are 10 practical tips about health insurance and health care, in case the pink slip comes.

1. Check with your spouse or partner.

If you're married or have a partner who has health insurance through their employer, look into getting added to their plan via special enrollment. That's often the most cost-effective option, and you don't have to wait until the open enrollment period -- but you need to do it within 30 days of losing eligibility for other coverage, according to background information posted on the Department of Labor's web site.

2. Consider COBRA.

COBRA (the Consolidated Omnibus Budget Reconciliation Act of 1986) allows you to keep the health insurance you had through your employer for up to 18 months.

COBRA will cost more than what got taken out of your former paycheck. Besides paying what you paid as an employee, you'll also pick up the tab that your employer covered, and you may also pay a 2% administrative fee.

"That can be cost prohibitive, but that is an option for people; they are able to keep that coverage during the time of transition," says Robert Zirkelbach, director of strategic communications for America's Health Insurance Plans, a trade group for health insurance companies.

Still, the U.S. Department of Labor's web site notes that "while COBRA rates may seem high, you will be paying group premium rates, which are usually lower than individual rates."

If your company closed or went bankrupt, COBRA won't be available; it's only an option if your company's health care plan is still around. And you have to enroll in COBRA; companies with at least 20 employees are usually required to offer COBRA coverage and to let employees know about that, according to the Department of Labor.

3. Look into private health insurance.

You can buy your own health insurance in the private health insurance market. Zirkelbach advises shopping around and taking a careful look at what you're buying, including:

Co-payments: a dollar amount you're expected to pay for doctor visits or prescriptions
Co-insurance: a percentage of medical bills that you're responsible for
In-network and out-of-network doctors: If you have a specific doctor in mind, ask the doctor's office or the health insurance company if that doctor is in the company's network of physicians.
Formularies: Find out if your medications are covered and what you would pay for them.

4. Got kids?

Find out about your state's children's health insurance program (SCHIP). If you meet certain financial standards, your children may be eligible for coverage through SCHIP. Contact your state health department to find out.

5. Know your rights about pre-existing conditions.

If you join a new group health insurance plan -- either through your spouse or partner's plan or in a new job -- you can't be denied coverage because of pre-existing medical conditions, but you may have a waiting period of up to a year in certain situations; the rules are posted on the Department of Labor's web site.

Private health insurance companies can deny your application for coverage based on pre-existing conditions.

6. Can't get private health insurance?

Look into whether your state has a high-risk pool.

"That is for individuals who have medical conditions or have difficulty getting coverage -- several states have set up what are called high-risk pools that allow those individuals to purchase coverage," Zirkelbach tells WebMD.

7. Tell your doctor about the layoff.

It's important for your doctor to know about the things in your life that are affecting you, notes Robert Schwartz, MD, professor and chairman of the department of family medicine and community health at the University of Miami Miller School of Medicine.

Schwartz tells WebMD that he has many patients dealing with layoffs, from manual laborers to corporate vice presidents, and others who are worried about losing their jobs.

"It's a very significant problem," says Schwartz. "Negative stress ... can be very detrimental to people's well-being."

Your doctor can also help you check on ways to lower your drug costs and other medical expenses.

People who have to do the firing also may be "under tremendous stress" and feel "guilt-ridden and conflicted about their own role" in layoffs, notes Schwartz.

8. Be aware of what stress may do to you.

"How people cope with this type of stress is very variable from one person to the other," says Schwartz.

"Some people start overeating, some people stop their healthy routines like exercise, some people have difficulty sleeping," he says, adding smoking and drinking to that list. "All of these affect our state of well-being."

In some cases, stress can lead to heart palpitations, depression, anxiety, gastrointestinal problems, headaches, or worsening of pre-existing conditions, notes Schwartz.

9. Get perspective, and get active.

"The first step is to help people understand ... that they're dealing with common problems," says Schwartz. "Then we talk about coping mechanisms."

Schwartz's list of helpful coping strategies includes exercise, taking a proactive approach to job seeking, and volunteering.

"I'm very much of the mind-set to get people out and doing things," Schwartz says. "People sometimes are so shocked by losing their job that they become unable to even start looking for another job."

10. Be optimistic.

"I always tell people that the glass is either half full or half empty, and there's not much to gain by being pessimistic,' says Schwartz.

"Although at the moment when you give that advice it's hard for people to hear, it's my impression that people who can find a way of being optimistic usually do better and eventually get another job. It helps them to walk into a job interview with a positive attitude," says Schwartz.

SOURCES: Robert Zirkelbach, director of strategic communications, America's Health Insurance Plans. U.S. Department of Labor: "Retirement and Health Care Coverage: Q&As for Dislocated Workers." Robert Schwartz, MD, professor and chairman, department of family medicine and community health, University of Miami Miller School of Medicine.

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