COBRA Health Insurance For Unemployed Individuals – Why You Must Get COBRA Right Now
The term COBRA can be intimidating for people. A lot of people don’t understand what this insurance is and its role in a person’s insurance policy. If you are in need of COBRA health insurance but don’t know how to get it, you should read on. This article will explain everything you need to know about COBRA health insurance. It also explains why it may be helpful for you.
COBRA is an abbreviation for Consolidated Omnibus Budget Reconciliation act. It is the act that congress passed in 2021 to allow people who have been affected by a job loss to keep their health coverage for a certain period of time. It was named after former Senator John McCain, who was the main sponsor of the act. It helps an unemployed or self-employed individual who has lost his or her job and needs to keep the same health coverage that he or she had before the job loss until a normal period of employment starts again.
It also goes by the name American rescue plan. A COBRA health insurance premium will cost more money if you lose your job before the year ends, than if you wait until the end of the year. This is because COBRA premiums are based on the average of all future health insurance premiums and a person who has to pay more money now will have higher insurance costs in the future. The cost is different for each individual and can range anywhere from a few hundred dollars to over a thousand dollars a year.
The reason why the COBRA premium goes up if you lose your job is because the company no longer offers health care to its employees. They use the money that they would have given to their employees during the year to cover their own losses. If you still have your job and you do not want to go through the open enrollment period, you can opt for COBRA until the end of the year. This means that you will have to pay a premium that is less expensive than what you would have paid under COBRA. The difference between the amount that you would have paid during the open enrollment period and the amount that you will pay in the case of a COBRA policy is the employer’s portion.
You must understand, though, that the United States government has a special enrollment period for people who have just lost their jobs. If you meet the specific employment criteria, you will be granted a six-month waiting period in which you can enroll in COBRA. Only certain people – including people who were continuously employed during the year – qualify for this six-month waiting period. People who have just lost their jobs will have to settle for the standard one-month open enrollment period.
Another reason as to why you must get COBRA right away is because of the extremely high premiums. The premiums for COBRA are significantly higher than they would have been for individual policies. These high premiums will make it impossible for you to pay for the premiums by coming out of your current income. For example, if you lost your job as a mortgage processor and ended up being an insurance claims adjuster – a very highly specialized job that typically comes with much higher premiums – you would have a hard time paying for the premiums on COBRA. Even if you were able to pay for the premiums, you would likely end up losing your job before the special enrollment period ends.
There is another important reason as to why you should buy COBRA now. One of the reasons is that the special enrollment period is scheduled to end on April of next year. If you do not buy COBRA by then, you will be left without adequate coverage. Some people end up paying hundreds of dollars each month for completely inadequate plans. Imagine having to pay premiums for one more month just so you can get some peace of mind. You would not want to do that, would you?
In short, you should consider COBRA if you think you or any of your employees are not likely to be covered by your employer’s health insurance coverage. The reason for this is because most people are not going to be able to afford the premiums. It is a good idea to get your employees covered up until the end of the year, at least in the short term. There is always the possibility that things change dramatically in the future, but you are unlikely to be able to wait. The premium for COBRA is usually quite affordable, so you should go ahead and make your choice today.