Apr 9, 2020

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What to expect if you become unemployed

by | Apr 9, 2020

Few events strike more anxiety and uncertainty than the prospect of unemployment – especially during a pandemic outbreak that’s already fraught with anxiety and uncertainty. If the fear of contracting the coronavirus doesn’t make you nervous, the thought of losing your income most likely does — and for good reason, if you earn a low to moderate income.

In the last week of March alone, unemployment filings in Colorado rose to 60,784 – an alarming increase of 207.4 percent from the previous week and an increase of nearly 4,000 percent from the same time in 2019. As non-essential businesses reduce operations or shutter during what’s expected to be a prolonged quarantine for many workers, the numbers of the unemployed are expected to grow to levels unseen since the Great Depression.

Currently, unemployment benefits for Coloradans cannot exceed $618 a week – or $2,472 a month. That figure is slightly above the Self-Sufficiency Standard for Colorado for a single adult household in most of Colorado, but it won’t cover the cost of basic needs if you add dependents to the household. However, the average unemployment benefit is about $400 a week (or $1,600 a month) – far below the Self-Sufficiency Standard in all family compositions in all Colorado counties. Communities of color and people in rural areas tend to be disadvantaged in terms of income and job security, so losing income will disproportionately exacerbate their economic circumstances.

However, if you lost your job or if your employment seems shaky, it may offer solace to know that state and federal officials are ramping up efforts to provide short-term relief amid the COVID-19 outbreak – though such efforts have been slow to leave the gate so far.

Under the $2 trillion Coronavirus Aid, Relief and Economic Security Act (CARES), recipients of unemployment insurance would receive an additional $600 a week for the next four months ending July 31. That effectively doubles the maximum benefit that an unemployed Coloradan could receive – providing that they were employed at least 32 hours a week and can provide proof that they are legally present. Unfortunately, it will take some time for those $600-week-payments to end up in the unemployment checks as the U.S. Department of Labor coordinates with state agencies to get the money flowing.

Private contractors, gig economy and seasonal workers not traditionally covered by unemployment will also receive emergency benefits under the CARES Act, but not yet. The state is advising these workers to keep checking into ColoradoUI.gov while it implements those options. The CARES Act also provides new coverage for people diagnosed with COVID-19, people unable to work because they’ve been asked to self-quarantine, people caring for family members with COVID-19 and people caring for children whose schools and daycares are closed.

All U.S. taxpayers are also entitled to an Economic Impact Payments from the government. Each taxpayer would receive up to $1,200 plus additional funds for dependents. Though hardly enough to cover a monthly rental or mortgage payment in most parts of Colorado, these payments could help many people weather the economic storm — providing that the quarantines are short-term, the economy recovers soon and people quickly find work.

Filing for unemployment
The Colorado Department of Labor and Employment CDLE advises people to file for benefits after they’ve completed their first day at work through their online portal. As a result of high call volumes, the Colorado Department of Labor is asking that people with last names that start with A through M apply on Tuesday, Thursday or Saturday after noon. People with last names that begin with M through Z should apply on Mondays, Wednesdays and Fridays before noon.

If you are eligible for unemployment insurance payments, it can take four to six weeks to receive your first benefit check, but CDLE officials say they are trying to expedite the turnaround to 10 to 14 days. Recipients are not paid for the first week they are eligible. While receiving the benefits, you must report your earnings and your job-search activities every two weeks.

Once you apply, you are required to connect to an employment center through connectingcolorado.com (though you don’t have to be unemployed to take advantage of these services).

Currently, Coloradans can receive unemployment checks for up to 26 weeks, though state officials are pushing to expand the benefit to 39 weeks because of the extenuating circumstances with the public health crisis. Benefit recipients are expected to accept “suitable work” if offered (i.e., within the recipient’s skills, salary range and location).

In factoring your unemployment, CDLE will take severance pay, accrued vacation time, withdrawals from your retirement savings and separation bonuses into account, if you are fortunate enough to receive such benefits. Every week of pay that you receive from those benefits will delay your unemployment insurance payments by one week. On the upside, that policy could also extend the life of your claims if you encounter difficulty re-entering the job market.

Also, keep in mind that unemployment insurance benefits are taxable, so you could opt to withhold a portion for Social Security, and state and federal tax or wait until the next filing period.

Other considerations
While those eligible for unemployment could potentially recover up to 90 percent of their salary with unemployment insurance benefits the CARES Act bonus, that income doesn’t cover other benefits that many employers provide such as health insurance premiums or a matching 401(k). While it might sound tempting to go without health insurance, the risks have never been higher with the coronavirus outbreak still active. We recommend that you enroll in reduced-cost health insurance through Connect for Health Colorado’s website. Because of the COVID-19 emergency, there is a special enrollment period through April 30.

You might also qualify for premium-free public coverage from Health First Colorado (Colorado’s Medicaid program). You can apply for Medicaid, Children’s Health Plan Plus (CHP+) other public health plans through Colorado PEAK’s website.

Depending on your income level, you might be eligible for the Supplemental Nutrition Assistance Program (SNAP) and special assistance for Women, Infants and Children (WIC) online through this link. Check out CCLP’s SNAP Benefit Calculator to see if you qualify.

For other resources related to human service programs available to Coloradans experiencing an income loss, visit CCLP’s COVID-19 Resources webpage.

Closing thoughts
Unfortunately, this health and economic crisis gives more people a window into the instability that Coloradans facing poverty routinely encounter: not knowing how one will be able to afford the basic needs of food, health and housing on a week-by-week basis, not to mention the bureaucracy and the onerous requirements needed just to continue receiving benefits such as SNAP, Medicaid and Basic Cash Assistance.

In particular, the racial disparities between different ethnicities has emerged during the pandemic. As Colorado Rep. Leslie Herod recently pointed out to Colorado Public Radio, many families facing poverty don’t have the option of staying home and filing for unemployment. “We have health disparities that combined, make a very bad situation worse.”

Finally, as pointed out in another CCLP blog, safety net programs exist to help people through difficult times – whether they are facing the coronavirus, temporary setbacks, a recession or struggling with systematic challenges. More Coloradans will soon learn the value of these programs in keeping them afloat during this crisis.

In saying that, we urge you to support the work of CCLP and other advocacy organizations in ensuring that the safety net remains strong for all people facing poverty.

– By Bob Mook

Recent articles

CCLP’s 2024 legislative wrap-up, part 2

CCLP's 2024 legislative wrap-up focused on expanding access to justice, removing administrative burden, supporting progressive tax and wage policies, preserving affordable communities, and reducing health care costs. Part 2/2.

CCLP’s 2024 legislative wrap-up, part 1

CCLP's 2024 legislative wrap-up focused on expanding access to justice, removing administrative burden, supporting progressive tax and wage policies, preserving affordable communities, and reducing health care costs.

CCLP testifies in support of Clean Slate updates

Bethany Pray, CCLP’s Chief Legal and Policy Officer, provided testimony in support of House Bill 24-1133, Criminal Record Sealing & Expungement Changes. CCLP is in support of HB24-1133, as it is one of our priority bills.

HEALTH:
HEALTH FIRST COLORADO (MEDICAID)

To maintain health and well-being, people of all ages need access to quality health care that improves outcomes and reduces costs for the community. Health First Colorado, the state's Medicaid program, is public health insurance for low-income Coloradans who qualify. The program is funded jointly by a federal-state partnership and is administered by the Colorado Department of Health Care Policy & Financing.

Benefits of the program include behavioral health, dental services, emergency care, family planning services, hospitalization, laboratory services, maternity care, newborn care, outpatient care, prescription drugs, preventive and wellness services, primary care and rehabilitative services.

In tandem with the Affordable Care Act, Colorado expanded Medicaid eligibility in 2013 - providing hundreds of thousands of adults with incomes less than 133% FPL with health insurance for the first time increasing the health and economic well-being of these Coloradans. Most of the money for newly eligible Medicaid clients has been covered by the federal government, which will gradually decrease its contribution to 90% by 2020.

Other populations eligible for Medicaid include children, who qualify with income up to 142% FPL, pregnant women with household income under 195% FPL, and adults with dependent children with household income under 68% FPL.

Some analyses indicate that Colorado's investment in Medicaid will pay off in the long run by reducing spending on programs for the uninsured.

FOOD SECURITY:
SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM (SNAP)

Hunger, though often invisible, affects everyone. It impacts people's physical, mental and emotional health and can be a culprit of obesity, depression, acute and chronic illnesses and other preventable medical conditions. Hunger also hinders education and productivity, not only stunting a child's overall well-being and academic achievement, but consuming an adult's ability to be a focused, industrious member of society. Even those who have never worried about having enough food experience the ripple effects of hunger, which seeps into our communities and erodes our state's economy.

Community resources like the Supplemental Nutrition Assistance Program (SNAP), formerly known as Food Stamps, exist to ensure that families and individuals can purchase groceries, with the average benefit being about $1.40 per meal, per person.

Funding for SNAP comes from the USDA, but the administrative costs are split between local, state, and federal governments. Yet, the lack of investment in a strong, effective SNAP program impedes Colorado's progress in becoming the healthiest state in the nation and providing a better, brighter future for all. Indeed, Colorado ranks 44th in the nation for access to SNAP and lost out on more than $261 million in grocery sales due to a large access gap in SNAP enrollment.

See the Food Assistance (SNAP) Benefit Calculator to get an estimate of your eligibility for food benefits.

FOOD SECURITY:
SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND CHILDREN (WIC)

Every child deserves the nutritional resources needed to get a healthy start on life both inside and outside the mother's womb. In particular, good nutrition and health care is critical for establishing a strong foundation that could affect a child's future physical and mental health, academic achievement and economic productivity. Likewise, the inability to access good nutrition and health care endangers the very integrity of that foundation.

The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) provides federal grants to states for supplemental foods, health care referrals, and nutrition information for low-income pregnant, breastfeeding and non-breastfeeding postpartum women and to infants and children up to age five who are found to be at nutritional risk.

Research has shown that WIC has played an important role in improving birth outcomes and containing health care costs, resulting in longer pregnancies, fewer infant deaths, a greater likelihood of receiving prenatal care, improved infant-feeding practices, and immunization rates

Financial Security:
Colorado Works

In building a foundation for self-sufficiency, some Colorado families need some extra tools to ensure they can weather challenging financial circumstances and obtain basic resources to help them and their communities reach their potential.

Colorado Works is Colorado's Temporary Assistance for Needy Families (TANF) program and provides public assistance to families in need. The Colorado Works program is designed to assist participants in becoming self-sufficient by strengthening the economic and social stability of families. The program provides monthly cash assistance and support services to eligible Colorado families.

The program is primarily funded by a federal block grant to the state. Counties also contribute about 20% of the cost.

EARLY LEARNING:
COLORADO CHILD CARE ASSISTANCE PROGRAM (CCCAP)

Child care is a must for working families. Along with ensuring that parents can work or obtain job skills training to improve their families' economic security, studies show that quality child care improves children's academic performance, career development and health outcomes.

Yet despite these proven benefits, low-income families often struggle with the cost of child care. Colorado ranks among the top 10 most expensive states in the country for center-based child care. For families with an infant, full-time enrollment at a child care center cost an average of $15,140 a year-or about three-quarters of the total income of a family of three living at the Federal Poverty Level (FPL).

The Colorado Child Care Assistance Program (CCCAP) provides child care assistance to parents who are working, searching for employment or participating in training, and parents who are enrolled in the Colorado Works Program and need child care services to support their efforts toward self-sufficiency. Most of the money for CCCAP comes from the federal Child Care and Development Fund. Each county can set their own income eligibility limit as long as it is at or above 165% of the federal poverty level and does not exceed 85% of area median income.

Unfortunately, while the need is growing, only an estimated one-quarter of all eligible children in the state are served by CCCAP. Low reimbursement rates have also resulted in fewer providers willing to accept CCCAP subsidies.