(CNN) -- In early October, Starla Darling was just days away from giving birth to her second child. The 27-year-old mother from Polk, Ohio, had a well-paying job with good health insurance at the Archway Cookie plant in nearby Ashland.
After being laid off, Starla Darling worried whether her daughter's birth would be covered by insurance.
But during a visit to her parents' house, Darling received news that sent her into a panic. A neighbor, who also worked at Archway, told them the plant was closing and their health insurance was ending two days later.
"I flipped out," Darling said. "It was five minutes after she told me, I was on the phone with the doctor," Darling said. "I told her, 'I need to be induced.'"
A few hours later, Darling was in the hospital. The next day, she had to have an emergency C-section. Darling was angry and disappointed. "I was supposed to have water labor. I wanted everything to be natural. I was forced into something I did not want to do."
After the mad rush to give birth to baby Kathryn, Darling got some more bad news. A bill for nearly $18,000 arrived from the hospital. Even though Darling gave birth before she says she was told her insurance was supposed to run out, the company denied the claim. She also says it denied other claims from earlier in the year. She wonders where the money went. "I paid $67 a week out of my check," she says, exasperated.
She and her husband Derek are trying to figure out what to do next. "We are two months behind on rent. The light bill is past due," she says with a sigh.
Darling is one of the growing numbers of Americans who are not only losing their jobs, but also their health insurance. The Labor Department reported Thursday that the number of Americans filing for unemployment is at a 26-year high. Initial filings for state jobless benefits surged to 573,000 for the week ending December 6. That was an increase of 58,000 claims from the previous week. That means more families are without insurance.
"We are hearing dire predictions on where that will land," said Kathleen Stoll, deputy executive director of Families USA, a nonprofit that advocates for universal health coverage. "If we are not in a crisis now, we are certainly heading there quickly in 2009."
Under federal law, when someone loses his or her job, they can apply for COBRA. COBRA allows employees who leave a company to be covered under the company's health care plan for a year and a half. In special cases, COBRA coverage can last up to three years. Former employees have to pay the full premium and that can be expensive. According to Stoll, the average COBRA premium is between $12,000 and $13,000 a year.
Darling wasn't offered COBRA because Archway Cookies had filed for bankruptcy. According to The Ashland Times-Gazette, 274 people lost their jobs. The company's health plan had been self-insured, meaning the company paid all the costs itself. And when the plant closed, the money dried up.
"It leaves individuals in a huge lurch," said Amy O'Meara Chambers, an employee benefits attorney in Grand Rapids, Michigan. "You can't get blood from a stone."
President-elect Barack Obama says expanding access to health insurance is one of his top priorities. According to the U.S. Census bureau, nearly 46 million Americans don't have health insurance.
"If we want to overcome our economic challenges, we must also finally address our health care challenge," Obama said Thursday when he announced former South Dakota Sen. Tom Daschle is his pick for secretary of Health and Human Services and director of the White House Office of Health Reform.
Obama also said some people ask how the United States can afford health care reform. "I ask a different question -- I ask how we can afford not to," he said, pointing out that small businesses are laying people off and closing down because of rising health care costs.
As for Starla Darling, she is trying to figure out how to pay her medical bills. Darling applied for Medicaid while in the hospital. In many states, including Ohio, Medicaid covers medical expenses in special circumstances, such as pregnancy, if the expenses were incurred up to 90 days before the date of application and if eligibility requirements are met.
Many of Darling's former coworkers are not so lucky. Health care bills are stacking up and some people are putting off visits to the doctor.
But there is a bit of a silver lining. Lance Inc., which makes cookies, crackers and candy, bought Archway. On Tuesday, company officials met with the plant's employees in a local high school gym. Armed with crackers and $1,500 Visa gift cards, they announced plans to reopen the plant. The company is starting to hire people back at the same wage and seniority.
Darling has re-applied for her job and is optimistic. "Lance is the best thing that's ever happened to us," she said as she looks at her children.
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