COBRA Insurance

Have you just been laid off? Quit your job? Do you want to quit your job, but you won't because you need you health insurance? Well, there is hope for you through COBRA, or the Consolidated Omnibus Budget Reconciliation Act of 1985. This law allows most people to continue receiving health care coverage from their employer for up to 18 months after the termination of employment or reduction in work hours. In most cases,the continuation of coverage is available to the insured, their spouse, and even their dependents.

The COBRA insurance plan allows you to keep your health insurance coverage, which can be very important, especially if you have a difficult time qualifying for private health insurance. When you obtained your health insurance through your employer, you did not have to qualify like you would have for private health insurance. Your private insurance premiums would be based on your health status, and it can get rather expensive if you have a significant health history. Also, you could have a difficult time getting private health insurance if there is a gap in coverage.

So, the benefit of COBRA health insurance is that you can remain insured for up to a year and a half after your employment is terminated or your hours are reduced. However, there is a downside to the coverage. It is rather expensive. Instead of your employer providing all or a partial amount of the premium, you are required to pay the entire premium. This amount can be significant, and sometimes more expensive than private insurance. You should get an estimate on private insurance before signing up for COBRA. If you are able to sign up for private health insurance quickly, either through the internet or a broker, you may want to get several estimates and compare prices and services. Often this will be the less expensive route to continuing health insurance coverage.

So how do you know if you should stay with a COBRA insurance option or private health insurance? Well, if you are currently being treated for a medical condition or have a recent or serious pre-existing condition, you should consider COBRA. Private health insurance policies for people with pre-existing conditions or significant health problems tend to have extremely high premiums, sometimes people with these conditions cannot qualify for private insurance.

Another reason to continue the COBRA coverage is if your next employer will not be able to provide you with health coverage for the duration of your employment or for a probation period. It is better to stay with the COBRA rather than have gaps in your insurance. You are a lower risk if you do not have any gaps in insurance coverage.

If you and your family are healthy, though, it may be better for you to obtain quotes for temporary, private health insurance coverage. Also, the benefit of COBRA is that you can elect to receive the coverage at any time during the 18 months you are eligible. This means that if you become ill 6 months after you terminate your employment, you can elect to receive COBRA coverage. However, you will have to pay the monthly premiums for all 6 months. It is pricey, but at least you know you have the option for coverage.

The key to determining whether or not you should elect to be covered by COBRA insurance is to assess you health and financial situation. Determine if you are eligible for private health insurance or if you can afford the COBRA premiums. Peace of mind is often worth the cost.

COBRA Insurance

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