What IS Cobra Health Insurance?
If you have ever lost a job and lost your health insurance you probably know what COBRA is.
If you haven’t please let me explain.
Cobra insurance enables you to continue their group coverage you had from work by paying the premiums for their coverage.
COBRA is generally available for qualified individuals leaving a company with 20 or more employees. But some states have created COBRA-like programs for groups of less than 20 full time employees.
This is ONLY a temporary fix! Your COBRA will expire! For a period of up to 18 months in most cases you can remain covered under your employer’s health insurance plan assuming you pay the premiums plus any administrative fees. In some instances this can be extended up to three years.
If you employer remains in business you will have the same coverage you had before.
But beware. Most of us have no idea how expensive health insurance is if we have always been covered at work. If this is the case you may be in for a shock.
You paying the full premium means the amount you were contributing towards this coverage before as a payroll deduction AND the portion your employer was paying AND a 2% administrative fee. So if you were paying $150.00 a month as a payroll deduction for your family plan you can expect to see that monthly premium shoot to maybe as much as $800.00 under COBRA.
It’s expensive but it does provide assurance that individuals will not be without health insurance coverage and gives individuals time to find other coverage.
The bad part about COBRA is that it can be too costly for people to pay for.
Insurance companies noticed this problem and developed health insurance plans specifically to offset these high cost.
If you find COBRA too expensive you may be able to purchase temporary health insurance coverage. If you are an individual that has no preexisting conditions you should pursue this alternative coverage.
Things to consider when deciding if the COBRA coverage you have been offered are your best option.
- Whether or not you prefer the comprehensive benefits and don’t mind the added cost
- Whether you are willing to exchange continual, guaranteed coverage for an added cost.
- If you have had recent health problems.
- If you have had ongoing health problems.
- If you require expensive medications.
- Whether or not you have been declined for private insurance recently.
- If you are currently pregnant.
- If you found a new job and your new employer does not offer a health plan.