Understanding COBRA Insurance - Not Many Do

Don't go into heart failure if you just lost your job. There is a law that makes you eligible to keep your medical coverage while you look for work. The federal COBRA law makes you eligible for continual health coverage for those already covered on your insurance. This is very important to make sure that people who are just divorced or have had a death in the providing family member have the bridge coverage they need. When either leaving a job or being let go from it, you are eligible to keep receiving benefits from your employers plan for 18 months by paying the premium yourself, That amount would otherwise have been deducted from your paycheck. The COBRA law is only for work related insurances, personal plans are not covered. Anyone who was working and had medical coverage at the time of being dismissed or leaving is by law required to be offered the option to hold onto their benefits at their own expense till the allotted time runs out of they have new coverage, which ever comes first.

There are three groups of people eligible for COBRA coverage; employees or former employees in private business, there spouses, and dependent children. You may get COBRA coverage for the maximum period determined by your status. You don't have to take it at all, if you don't need or want it, or for the entire time if you get offered new insurance. State and local government workers are also eligible as well as classified and independent contractors. The only people who are exempt are federal employees in Washington D.C., certain church-related persons, and firms with less than 20 employees. But even in the cases where there are not enough employees there could be eligibility. Some states have mini-COBRA laws for small places to help out those types of employees. The coverage will continue for all persons listed on the original policy and any added dependents during the allotted time frame.

To be eligible at all for COBRA you have to be covered under an employer health plan. If you don't already have medical benefits you won't qualify for this extended coverage. COBRA isn't a health care plan of its own; it is only a law that protects workers from losing all insurance when leaving their employer. All jobs will send you the information you need to keep or deny this extended coverage. You may or may not be given pricing information and might want to call the human resource department to find out or the insurance company itself. Your COBRA coverage will end when you reach the last day of maximum coverage, you stop paying the premium, the employer stops providing coverage to employees or goes out of business, or you get new coverage somewhere else, either through work or privately. The plans that are eligible for extended coverage on these types of medical coverage; medical plans, dental, prescription, and vision plans, drug and alcohol treatment programs, and psychological treatment.

Paying for COBRA is a personal responsibility to the individual. If you can't afford it you might have to pass and not be covered. The premiums can be very costly for people and even more than when the person was employed. Employers get a fixed rate based on the number of employees they have enrolled. The more employees they have enrolled the cheaper the premiums for all employees. A person on COBRA doesn't qualify as an employee and will be seen as a private insurer through the company. You will receive the exact same benefits you had when you were working for your job. An employer should advise you on all COBRA possibilities, and not just the cheapest or most expensive. If you had more than one plan then you have the right to elect continuing coverage in any or all of them. If your former employer changes its health insurance plan for its current employees, you are entitled to receive benefits under the new plan as well, although the benefits you get may change. If your employer switches plans, you won't be able to keep the old plan, you will have to choose to go to the new plan or drop coverage.