President Obama's $789 Billion Recovery Bill includes some health care benefits for those recently unemployed. If you lost your job after September 1st, 2008, this bill has some very good news for you regarding your health care. The federal government will soon subsidize 60% of your COBRA premium for 9 months. Doesn't sound like a big deal to you? Let me explain. COBRA coverage is offered to individuals and their families who had group coverage with their employer before they lost their jobs. The problem is that COBRA insurance premiums are high and unemployment benefits are no so high. In fact, the average premium for family COBRA coverage exceeds the entire monthly unemployment benefit in 9 states: Alabama, Alaska, Delaware, Florida, Louisiana, Mississippi, South Carolina, and West Virginia.
If you lost your job recently, you have 62 days to decide on taking the COBRA offer or not. TAKE IT. You'll have to pay the entire premium for a month or two, but once the new legislation takes effect, you'll be paying only 35% of the premium. It's a great deal. Purchasing your own individual health insurance, assuming you can qualify, will cost you more for less coverage. If you pass up on the COBRA offer or wait beyond the 62 day window, you can't opt in later. It's a one-time offer.
Unfortunately, last minute haggling removed from the bill a provision that would have extended COBRA coverage to age 65 for jobless Americans over age 55.
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I think it's great that they are helping families that the providers have lost their job. What about those families that have not lost their jobs but have been impacted by the economy. The small business owner that has seen a 20% decrease in revenue and needs to cut expenses somehow. There are different levels of coverage and maybe we should be looking a less expensive option than COBRA.