If you’ve lost your job, you may be able to keep your health insurance thanks to the American Recovery and Reinvestment Act that President Obama signed into law last month.
If you elected to take COBRA — which lets laid-off workers continue with their former employer’s coverage for up to 18 months — the government will now subsidize 65% of COBRA premiums for up to nine months. The subsidy is limited to workers laid off from Sept. 1, 2008, to Dec. 31, 2009.
COBRA is not cheap. The average monthly COBRA premium for individual coverage is $388, or about 30% of monthly unemployment benefits, says the Families USA Foundation. The monthly COBRA premium for family coverage is $1,069, or about 84% of benefits. So getting those premiums reduced by 65% is a big savings.
Employers and health plans will be sending notices to former employees about the aid plan, and the U.S. Department of Labor will post updates on their Web site HERE.
The California Society of CPAs – the nation’s largest professional, non-profit state association of about 33,000 CPAs – suggests going through this checklist of questions when deciding what to do about COBRA:
- Can you get coverage through your spouse or domestic partner’s employer?
- Can you continue your coverage through COBRA?
- Find out if your state has any laws or programs that can help you
- Find out if you are eligible for Trade Adjustment Assistance and the Health Coverage Tax Credit that comes with it
- Ask if you or any family members are eligible for Medicaid, the Children’s Health Insurance Program or VA coverage
- If you can’t afford COBRA and can’t get help through any public programs, shop carefully for insurance on the individual market
- And finally – realize that you may not be eligible for COBRA. (If your employer had fewer than 20 workers or went of out business completely and no longer has a plan – you don’t qualify.
Check out some of my previous columns on this topic:
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