For most people, the best option, if it’s available, is to continue their current employer-based health coverage under COBRA or Texas State Continuation.

If you work for an employer with 20 or more employees, you should be eligible for COBRA and will have the opportunity to continue your current coverage for at least 18 months (for dependents, the coverage period can be up to 36 months in certain situations). If your company has less than 20 employees, you may qualify for Texas State Continuation, which will allow you to extend your current policy for 9 months.

It’s important to understand that COBRA (and state continuation) is not a special type of health insurance; instead, it’s just a continuation of your current coverage. Of course, if you are no longer an employee, your employer will no longer be contributing to the cost of your health insurance, so you’ll have to pay the full amount. While this can be costly, there are still some advantages of keeping your group plan over buying a plan in the individual market:

• Group coverage is often less expensive than comparable individual plans.
• There are not a lot of options in the individual markets. In the DFW area, for instance, there are only three or four insurers offering individual health coverage, and only a couple that we would recommend.
• In the individual market in Texas, there are no PPO options. If you currently have a PPO through your employer or former employer, you may want to keep it if you can.

You have 60 days from the loss of coverage to sign up for COBRA or state continuation, and when you make the decision you have to pay premiums back to the day you lost coverage, so you’ll want to be sure to sign up quickly.