The death of a spouse is a stressful time, and adding to the worries may be what to do about the family’s health insurance.
Employer Group Health Insurance
As a dependent on an employer group health insurance plan, an individual will likely be offered COBRA coverage after the death of a spouse. COBRA simply extends the current coverage for a period up to 36 months, the dependent paying the full premium. The death of a spouse is also considered a “qualifying event” under the ACA, meaning the dependent may apply for an individual plan on the Marketplace. Depending on income, an individual Marketplace ACA plan may be the way to go if the applicant qualifies for a subsidy.
Another option during this stressful time is to simply enroll in COBRA for a few months until one has time and peace of mind to consider all the individual ACA Marketplace plan options. In Arizona, a 3 year Short Term health insurance policy is also a viable option in many cases. That said, it is important to note that if an individual enrolls in an individual plan or a short term plan they lose their right to enroll in COBRA. Short Term coverage will be the least expensive option, assuming the applicant does not qualify for a substantial subsidy through the ACA.
Over Age 65
When a spouse dies and the dependent is over 65, it is very important that the surviving spouse enroll in Medicare and a Medicare supplement plan. The surviving spouse will be offered COBRA most likely, but enrolling in COBRA will be a costly mistake. When Medicare eligible, COBRA is considered secondary coverage.
Medicare Coverage
The death of a spouse will not affect Medicare coverage. Medicare enrollment is individual coverage. In Arizona, all Blue Cross and Blue Shield Medicare supplement policies are sold on an individual basis, the death of a spouse will not affect coverage.
Individual Coverage
The death of a spouse and ACA tax subsidies can be a bit confusing when individual ACA policies are involved. It will all depend on household income. The surviving dependents premium may increase, decrease, or force the dependent into Medicaid. If the family is already receiving Medicaid when the spouse passes away coverage should not be affected.