COBRA Insurance Nastiest Punishment

COBRA, the Consolidated Omnibus Budget Reconciliation Act: why people condemn it but ironically acquires it at the same time. With people losing their jobs and getting laid off left and right this year, the special provisions of this rule help people basically buy medical insurance from the employers they used to work for, and they lovingly call this COBRA medical insurance in honor of the law passed under Ronald Reagan that makes this possible, the government is said to help its people get the chance of buying medical insurance from their past employers}. Of course it is a provision that helps poor people who aren't old enough to qualify for Medicare, get by in their time of need; but it is also something that reminds people so much of better times; it makes them feel stigmatized to have to use it the way it would if they needed food stamps.

Former employees, retirees along with their dependents are entitled to temporarily continue paying their COBRA health benefit as a group. This group health insurance of COBRA though is much more expensive than the one paid by employed personnel. Since, it is a must for companies to pay a part of the premium of their employees.

Included in the COBRA medical assistance are; hospital care (inpatient or outpatient), physician care, surgical and other major medical benefits, also prescription drugs and other medical cares such as those of dental and optical clinics. Receiving all these benefits is a definite relief for a lot of families. But why does it seem to bereave people?

There is this quiet and peaceful elderly couple we know; the husband is closing in on 70, and was laid off from a job as a shelf stocker quite a while ago; he receives his Social Security check, a couple thousand dollars, and is more or less okay. His wife is about seven years younger than him; she was working as a supervisor at a bookstore until recently, and had coverage; but the bookstore chain had to downsize, and she was laid off permanently. She lost her paycheck; she would never have been able to afford her expensive medication for blood pressure and back pain if she wasn't able to apply for COBRA medical insurance, buying it from the bookstore for a couple of hundred dollars every month; and she was grateful. However, it is likely to change because of President Obama’s business stimulus package at which point allows unemployed and laid-off citizens to claim their COBRA medical insurance for a span of only nine months. In March, she will need to fork over half of her paycheck to buy coverage, and she only makes about $1000 with her unemployment benefits. Now, the couple is puzzled as to where they’d be going to live after consuming all that remains from their benefits.

Why does the COBRA plan require citizens to work in this global recession; are there available jobs for old people which would support them in their help benefits rather than wages? Is it necessary for the government to push people to work themselves to death even if they’re not feeling well? What is more, anyone who gets laid off today can't even claim the nine months that my friends the old couple got, that is how the new COBRA is framed. Just do the math: most people get unemployment benefits of no more than $1000; and the average COBRA payment lies around $800.

Now, the government has observed the problems presented by COBRA medical insurance, and are now fixing it. Yet it consumes time, try to put yourself in the elderly couple’s shoes, what do you think would you do if in any case your benefits are running out fast? People need short term medical insurance coverage.

Well, the first rule of the game is, never to stop making payments for your COBRA medical insurance. When the subsidized rate ends, we won't really be getting any special notice, other than the heftier bill. You just have to find a way to pay it for now. Once you cease your payments, that’s the time they begin counting you as without medical insurance. You are alotted a 63-day count before permanently losing your paid COBRA insurance. If you give in all of your remaining money just in time, your insurance is safe. If it takes longer than that, then when you come to them for coverage one day, they count you as an all new customer, and you'll have to pay unimaginable premiums like any new insurance customer with all kinds of existing ailments does. Why not let group health insurance coverage just continue?

But, never lose your hopes, as soon as the law reforming the COBRA medical insurance is passed, rest assured, all of your excess payments will be refunded to you. If you keep asking your COBRA administrator for updates for when your refund will come, you will be notified. One certainly hopes that sense prevails over in Washington.