Friday
Jan092009
COBRA: Great in theory, but lousy in reality
Friday, January 9, 2009 at 2:15PM
Benefits provided by the Consolidated Omnibus Reconciliation Act (COBRA) are supposed to allow laid off workers retain their previous health insurance for an additional year and a half, however, COBRA's high premium costs have proved to be too expensive for many Americans. This outcome, in the words of Families USA Executive Director Ron Pollack, adds up to a 'tragic rouse'.
"COBRA health coverage is great in theory, but lousy in reality," said Pollack during a
"For the vast majority of workers who are laid off, they and their families are likely to join the ranks of the uninsured."
Pollack stated that paying COBRA costs on average consumes nearly 84% of a worker's unemployment insurance. According to Families USA, the national average for monthly unemployment benefits average $1278 dollars, whereas the average cost of COBRA premiums is $1069.
Pollack went on to explain that in 41 states, including the District of Columbia, family coverage premiums consume 3/4 of unemployment benefits and that in 9 of these states Cobra premiums either match or exceed the benefits.
"In Arizona, the average monthly insurance benefit is 937 dollars, compared to average Family COBRA premiums in that state of 1084 dollars. In other words, the Cobra premium would absorbs 116% of unemployment insurance income," said Pollack.
"In Alaska it consumes 132%...in Louisiana 115%, Mississippi similarly 155%, in Alabama 114%, in Delaware 105%, in West Virginia 104%, in Florida 102%, and in South Carolina it's 100%."
To counteract this situation, Pollack recommends providing subsidies for Cobra's premiums as well as temporary health safety net coverage through medicaid, steps that Pollack believes will be included in the upcoming economic recovery package.
"COBRA health coverage is great in theory, but lousy in reality," said Pollack during a
"For the vast majority of workers who are laid off, they and their families are likely to join the ranks of the uninsured."
Pollack stated that paying COBRA costs on average consumes nearly 84% of a worker's unemployment insurance. According to Families USA, the national average for monthly unemployment benefits average $1278 dollars, whereas the average cost of COBRA premiums is $1069.
Pollack went on to explain that in 41 states, including the District of Columbia, family coverage premiums consume 3/4 of unemployment benefits and that in 9 of these states Cobra premiums either match or exceed the benefits.
"In Arizona, the average monthly insurance benefit is 937 dollars, compared to average Family COBRA premiums in that state of 1084 dollars. In other words, the Cobra premium would absorbs 116% of unemployment insurance income," said Pollack.
"In Alaska it consumes 132%...in Louisiana 115%, Mississippi similarly 155%, in Alabama 114%, in Delaware 105%, in West Virginia 104%, in Florida 102%, and in South Carolina it's 100%."
To counteract this situation, Pollack recommends providing subsidies for Cobra's premiums as well as temporary health safety net coverage through medicaid, steps that Pollack believes will be included in the upcoming economic recovery package.
Reader Comments