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When should you elect COBRA Insurance?

COBRA is great if you have pre-existing conditions, see doctors often or take prescription medication.

Health Insurance Alternatives

When continuing your former work health insurance is not available or is cost-prohibitive, many people will choose Short Term Medical or Accident Only coverage as alternatives to COBRA to remain insured.

Employers Must Offer COBRA

The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that gives workers and their families the option to continue their employer-provided health insurance when it would otherwise end due to job loss or changes in the covered beneficiary’s family situation.

Under COBRA, you can maintain your traditional major medical plan and keep your existing doctors and clinics. It is required for companies with 20 or more full-time employees to offer the option for former workers to continue their coverage.

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COBRA Eligibility

When To Choose COBRA For Health Insurance

Here are some reasons you might consider choosing COBRA:

  • You have had comprehensive benefits and are willing to pay a higher premium for continued coverage.
  • You want guaranteed coverage, even if it comes at a higher cost.
  • You have had recent or ongoing health problems.
  • You are taking expensive medications.
  • You have been declined for private insurance recently.
  • You have a history of medical issues.
  • You have had an accident within the 60-day enrollment window.
  • You are pregnant or planning to become pregnant.
  • You have taken a new job and your employer does not offer a health plan.

When To Choose A COBRA Alternative

  • COBRA is unavailable or too expensive for you.
  • You need coverage to bridge a short gap until your next major medical plan.
  • You do not have any pre-existing conditions.
  • You want continuous coverage at a lower cost.
  • You have not had any health problems.
  • You have not received any recommendations from medical professionals for future medical procedures.
  • You are not pregnant or planning to become pregnant in the near future.
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COBRA ALTERNATIVE HEALTH INSURANCE

COBRA Is Expensive

The out-of-pocket cost for COBRA insurance is roughly $400 – 800/month, per person to continue on the employer’s group health plan. If you are looking to save money, consider a temporary health plan.

COBRA or Marketplace Health Insurance?

If you need Obamacare style of insurance that covers preexisting conditions and prescription medication, choosing COBRA will give you that. With COBRA, the deductibles you’ve paid in won’t change.

Losing your employer’s health insurance is a qualifying event. If you are looking for a new major medical plan, you may find marketplace plans on or off the health insurance exchanges.

Short Term Medical Insurance

An alternative to continuing on COBRA is a temporary short-term health insurance plan. This type of insurance can fill gaps until your next major medical plan begins.

Short-Term Health Insurance plans  provide a high level of care for new illnesses and accidents and flexible in term length. This type of insurance does not cover pre-existing conditions.

Who Is Entitled To COBRA Benefits?

Any employee that has been enrolled in a company’s group health plan for 1 day qualifies for COBRA benefits. When an employee signs up for workplace insurance, you must notify them of their COBRA rights to continue on that health plan if that insurance would end. Additionally, the option must be available to all qualified beneficiaries of the plan.

A qualified beneficiary is a health insurance plan dependent, such as spouses and children. As an example, if the covered employee dies, the spouse and other covered dependents shall be given the option to continue the same health insurance they had.

Health Care Sharing Ministry Plans Are Not Insurance

Health care sharing plans (HCSPs) may seem affordable, but it’s important to be aware of their limitations. Unlike insurance, HCSPs are not regulated by any state and are not approved by the federal Healthcare Marketplace. Instead, your monthly payment goes into an escrow account that members can request reimbursement from for medical expenses.

However, it’s important to read the fine print, as claims for reimbursement may be denied based on the sharing group’s values. For example, some plans may not cover injuries sustained while drinking at a bar or may not treat new STDs for unmarried members.

It’s important to note that HCSPs are not recommended as an alternative to COBRA for covering lapses in insurance coverage.

Are You Eligible For COBRA?

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