During this current time of widespread health risks and layoffs, it is especially important to know your health care options. If your employer contributes to your medical, vision, or dental coverage, you need to be able to answer the following question: “What will happen if I lose my job?”
What is COBRA?
The federal Consolidated Omnibus Budget Reconciliation Act (COBRA) allows you to keep your employer-based health plan for up to eighteen months in the event you lose your job. If you and your family were covered under your employer’s health insurance plan, then you can cover your entire family using COBRA. Almost all employer health plans are required to offer COBRA insurance to laid-off employees. The only exception is employers with less than 20 employees; employers with less than 20 employees are not required to offer COBRA insurance.
How much will COBRA cost and how long can I wait before I apply?
COBRA insurance, however, is expensive. Monthly COBRA payments will equal the total cost of the premium under your employer’s health insurance plan plus an additional two percent administration fee. Ouch. It is important to keep in mind, though, that COBRA is just one potential option out of many (more on that later).
If you lose your job, you have sixty days to choose COBRA or another health insurance plan. If you don’t choose COBRA, it is highly recommended that you choose a marketplace plan. If you don’t sign up for any health insurance plan during the sixty-day period, you might have to go uninsured until the next open enrollment period. Keep in mind that medical emergencies are the number one reason for bankruptcy in the United States.
Finding additional health care options
If you are worried about losing your job, you should familiarize yourself with the strengths and weaknesses of your employer’s health care plan, because finding a new health insurance plan that meets your needs and is affordable requires you to spend some time identifying your medical necessities. Understanding what you need in a plan versus what is simply nice to have will allow you to maintain coverage even if the worst should happen. Unfortunately, I can’t help you identify your medical necessities, but I can help you identify how you can find a new plan.
- Health Insurance Agent
A health insurance agent is literally trained to shop around to find an insurance plan that meets your medical needs. Finding health insurance agents in your area is as easy as doing a quick Google search.
- Health Insurance Marketplace
The Health Insurance Marketplace, found at www.HealthCare.gov, offers a nice alternative if you want to search for a plan yourself. Additionally, most plans found in the Health Insurance Marketplace cost less than COBRA continuation coverage.
God bless you all in these trying times.
- George Freeman, Presiding Chaplain of the Universal Life Church
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