The window to switch health coverage after losing a job-based plan closes fast — federal rules give you 60 days to elect COBRA or enroll in an alternative, and that clock doesn’t pause for confusion, grief, or a depleted savings account. I was thinking about that deadline when I sat across from Lorraine Kowalski at a coffee shop in San Jose’s Berryessa neighborhood last November, her folder of insurance notices spread across the table before she’d even ordered.
A mutual friend had mentioned Lorraine’s situation at a neighborhood barbecue in late October 2025 — something about a home health aide paying more for insurance than for rent. I asked if she’d be willing to talk. She said yes almost immediately, with the kind of relief that comes from finally being asked.
Lorraine Kowalski is 41, single, no dependents, and has worked as a home health aide for six years. She shares a two-bedroom apartment with a roommate to keep costs manageable in one of the country’s most expensive housing markets. Her rent share is $1,200 a month. For two months — August and September 2025 — her COBRA premium was $1,340.
The Bill That Upended Everything
For most of her time at the agency, Lorraine’s base salary of roughly $38,500 a year was supplemented by consistent overtime. One client, an elderly man with advanced Parkinson’s, needed extended care on weekends. That arrangement added between $480 and $560 a month to her take-home pay — money she had quietly come to rely on.
In July 2025, the client’s family moved him into a memory care facility. The overtime ended. Then, in August, the agency restructured its benefits package and discontinued the group health plan. Lorraine received a COBRA election notice in the mail. She called the benefits line three times to confirm the premium amount before she believed it.
“I genuinely thought I was reading it wrong,” Lorraine told me, smoothing out the notice on the table between us. “I called the benefits line three times. Each time they confirmed it. One thousand, three hundred and forty dollars a month. I make thirty-eight thousand a year.”
She paid it in August. She paid it again in September. The two premiums together totaled $2,680 — drawn directly from an emergency savings account that had held $4,100 in July. By early October, that account was down to $820. Her side income from pet-sitting and occasional elder companion services, offered through a local app, had also been declining. A regular client had stopped using her in June. The numbers were converging in a direction she didn’t want to look at directly.
What She Didn’t Know About Medi-Cal
The irony of Lorraine’s situation was not lost on either of us during our conversation. She spends her working days helping elderly clients manage their Medicare documents — reminding them about Part B deductions from their Social Security checks, sitting with them as they sort through explanation-of-benefits statements. She understood their system. Her own was a different country entirely.
“I kept confusing Medicaid and Medicare in my head, even though I work in healthcare,” she said, laughing softly in a way that didn’t reach her eyes. “I knew my clients had Medicare because they were old or disabled. I didn’t really know what Medicaid was for, or who qualified.”
The distinction is significant. As HHS.gov explains, Medicare is primarily for people 65 and older or those with certain qualifying disabilities. Medicaid — called Medi-Cal in California — is a joint federal-state program for low-income individuals regardless of age. Lorraine, at 41 and earning under $40,000 a year with declining income, might qualify. She hadn’t considered it.
The mutual friend who had connected us had nudged Lorraine toward Medi-Cal options back in September. Lorraine had dismissed the idea. “I thought Medicaid was for people in real poverty,” she told me. “I have a job. I have a roommate. I’m managing.” What she hadn’t calculated was that in the months she paid the COBRA premium, more than 42% of her take-home pay was going to health insurance alone. By most definitions, that is not managing.
The Income Complication That Almost Derailed Her
Applying for Medi-Cal was not as simple as Lorraine had hoped, and for good reason. California’s Medi-Cal program uses Modified Adjusted Gross Income to determine eligibility. For a single adult without dependents, the income limit sits at 138% of the federal poverty level — approximately $20,783 in 2025. Lorraine’s base wages were nearly double that threshold.
What made the picture more complicated was the structure of her work. Her home health agency income was W-2. Her pet-sitting and companion care income was 1099. When she sat down with an enrollment navigator at a local Covered California assistance center in October 2025, they calculated her projected annual income for the remainder of the year — accounting for the lost overtime and the declining 1099 work. The number came in at approximately $29,400.
At $29,400, she was above the Medi-Cal threshold but within range for a subsidized silver plan through Covered California. The navigator recommended applying for both simultaneously and letting the system determine which she qualified for. That was information Lorraine hadn’t known existed.
“I had no idea you could apply for both at once,” she told me. “I thought I had to figure out which one I wanted and then commit. The navigator just said let the system sort it. That saved me so much stress.”
The Outcome — and the Fear That Came With It
In early November 2025, Lorraine received a determination letter. She had been approved for a subsidized Covered California silver plan with a monthly premium of $67 after Advanced Premium Tax Credits. Coverage was set to begin December 1, 2025. She had paid her last COBRA premium in October.
“I cried when I opened the letter,” she said. “Not because everything was fine, but because one catastrophic thing was off the table. I could breathe.”
The shift in monthly cash flow was immediate. Instead of $1,340 leaving her account, it was $67 — a difference of $1,273 a month. Her savings account, which had bottomed out at $820 in October, had recovered to approximately $1,900 by the time we met in late November. She was not out of the woods, but she had stopped moving deeper in.
Still, she was guarded about calling it a resolution. Her income could change. If she picks up more 1099 work, or if her agency restores overtime hours, her subsidy could be recalculated. She is required to report income changes to Covered California, and she knows the math can shift quickly.
“I’m grateful,” she said, gathering up her folder at the end of our conversation. “But I also know this isn’t stable. I’m one good month from maybe losing the subsidy. I’m one bad month from not covering even the sixty-seven dollars.” She paused. “That’s just kind of the life.”
Her clients, she noted, were navigating their own version of this arithmetic. According to CNBC, the standard Medicare Part B premium jumped 9.7% in 2026 to $185 a month — a change that reduces the Social Security checks of the roughly 50 million Americans enrolled in both programs. As one analysis described it, the 2026 cost-of-living adjustment for Social Security was partly absorbed by the higher premium before beneficiaries ever saw it. Lorraine watched that play out in her clients’ kitchen tables.
“They get a COLA increase and Medicare takes a chunk of it back,” she told me. “I get a subsidized plan and I’m terrified to earn too much. It feels like there’s no solid ground. For any of us.”
For those trying to understand where Medicaid fits relative to Medicare, Medicare.gov notes that Medicaid can cover services Medicare typically does not — including personal care services, the very work Lorraine performs for others every day. There is something specific about that gap that stayed with me after we said goodbye in the parking lot. She helps people access a system she couldn’t access herself. And when she finally found her footing, it was because someone took twenty minutes to explain how the paperwork worked.
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