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Avoiding Gaps in Insurance With COBRA

Posted on: December 6th, 2012 by Kristen Marie

Dear COBRA Insurance Direct -

I was recently laid off. It was a little less than two months ago and I can’t figure out what I need to do to make sure I don’t have a gap in coverage or if that even matters. I am lucky and can get on my husband’s insurance plan but I won’t be able to sign up for three months. I have read that having a gap in coverage isn’t ideal because if by any chance I develop a condition, that condition will likely be excluded from future policies. Can you help? I only have a few days to decide and I have to come up with $1400 if I use COBRA since I will have to make the retroactive payments.

- Confused About Gap Coverage

This is a really great question and something that concerns many people who are transitioning between jobs or health plans. You are completely right that you do not want to experience a gap in coverage because that is when you open yourself up to major liability if you develop any major medical conditions that could potentially be excluded in the future. What is a gap? A gap under HIPAA is a period of 63 days or more. Under the law you can not be excluded if you do not experience a lapse of greater than 63 days.

In your situation since your lapse in coverage will total 5 months before you are on your husband’s plan, you will want to ensure you have some type of interim coverage. This could be COBRA or could be a less expensive option like short term insurance or high deductible insurance. These plans will ensure you don’t have a lapse in coverage but will not cost a lot of money. Just be aware that if you go with a plan like this, you will essentially need to pay out of pocket for any treatment since the plans don’t normally kick in for anything that isn’t an emergency.

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