Domestic Diversions

The high cost of COBRA coverage: For most, no end in sight

USA Today highlights the problems displaced workers are encountering when their COBRA subsidy ends or they do not qualify.

Note: At the time of a divorce, an employee’s former spouse is eligible for COBRA coverage for 36 months, but someone needs to pay the full premium plus the 2% administrative fee. In contrast, terminated employees are eligible for COBRA coverage for only 18 months. Different triggering events, differing eligibility periods.

Andrew Villegas and Phil Galewitz of Kaiser Health News write (excerpt):
Finding affordable insurance can be tough. The average price for family coverage is about $1,100 a month, according to the U.S. Agency for Healthcare Research and Quality. With the subsidy, COBRA coverage costs $385.

Laid-off workers looking for insurance will get little immediate help under the new health care law, which will sharply expand coverage, but not until 2014. A provision that sets up high-risk insurance pools for people with health problems who can’t get insurance also won’t help people on COBRA because applicants must have been uninsured for six months to qualify.

Meanwhile, getting private health insurance on the individual market poses its own challenges. Until 2014, insurers can still reject adults with medical problems or charge them much steeper rates.

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