The Truth About Cobra Health Insurance Cost

The Truth About Cobra Health Insurance Cost

Are you one of the millions of Americans who have lost their jobs due to the COVID-19 pandemic? If so, you may be eligible for COBRA health insurance. COBRA stands for Consolidated Omnibus Budget Reconciliation Act, which allows you to continue receiving the same health insurance coverage you had while you were employed. But how much does COBRA health insurance cost and is it worth it?

Understanding How COBRA Health Insurance Works

COBRA health insurance is a federal law that requires employers with more than 20 employees to offer continuation of health care benefits to employees, spouses, and dependents who lose coverage due to job loss, reduction of hours, or other qualifying events. COBRA typically allows you to continue coverage for up to 18 months, and in some cases, up to 36 months if you meet certain requirements.

Calculating the Costs of COBRA Health Insurance

The cost of COBRA health insurance depends on several factors such as the type of plan you had, the number of dependents you have, and the percentage your employer paid towards your premiums. On average, COBRA health insurance typically costs 102% of the full premium price, which includes the amount your employer paid plus your share.

For example, if your monthly health insurance premium was $500 and your employer paid 80% of the cost, then your share was $100 per month. With COBRA health insurance, you would be responsible for both your share of $100 and your employer’s share of $400, bringing the total monthly cost to $510.

In addition to the premiums, you may also be responsible for deductibles, copays, and coinsurance. COBRA health insurance does not cover the full cost of your healthcare expenses, so you may end up paying more out of pocket than you did when you were employed.

Exploring Alternatives to COBRA Health Insurance

COBRA health insurance can be a costly option for those who have lost their jobs. Fortunately, there are alternative options available that may be more affordable. These options include:

– Medicaid: If your income is low enough, you may be eligible for Medicaid, which is a government-funded health insurance program.

– Marketplace Insurance: You may be eligible for subsidized health insurance through the Health Insurance Marketplace if you have lost your job and your income has decreased.

– Short-Term Health Insurance: Short-term health insurance may be a more affordable option if you only need coverage for a short period of time.

Conclusion

COBRA health insurance can be a valuable option for those who want to keep their current health insurance coverage after losing their jobs. However, it is important to understand the costs associated with COBRA and explore alternative options that may be more affordable. By doing your research, you can make an informed decision about your healthcare coverage during this uncertain time.