So you've been offered COBRA. What the heck is it? And why you might not want it.
What is COBRA?
If you have group health insurance coverage through your employer and you loose your job, you'll be offered COBRA health insurance. It's the same coverage you had before but your employer will no longer be paying for it. It usually comes as a shock to most people when they find out just how much the full premium is. The COBRA eligibility period is 18 months. California allows an additional 18 months under Cal-COBRA, however, the premium increases during the second 18 month period from 102 percent of the group employer's premium to 110 percent of the premium.
Why not COBRA?
COBRA will cover you regardless of your pre-exisisting conditions, but if you are a personal trainer or yoga instructor, you may be better off applying for an individual health insurance policy. Individual health insurance has more low-cost health plans available than group health plans do. So you'll probably save money going with an individual health plan, but you have to go through the underwriting process and qualify as a low-risk applicant.
Try Individual Health Insurance First
You have a 62 day window, from the first of the month following your termination, to test the individual market to see if you can be approved. If not, you can elect COBRA retroactively to the first day of your eligibility. If you must go with COBRA, you can stay on COBRA 36 months, then you'll qualify for a HIPPA conversion plan. These plans are very expensive compared to the standard premiums of individual health insurance plans -despite having identical benefits to standard plans, but they will cover you even if you have one foot in the grave.
