If you’ve lost your job, COBRA lets you keep your health insurance. While this program can be a saving grace when you fall on hard times, it has some very real drawbacks.
In trying times, it’s often easiest to take the route that’s already been laid out for you. For those who are fired, laid off, or face dramatically-reduced work hours, losing health insurance is an additional source of stress in an already trying time.
In these situations, COBRA (the Consolidated Omnibus Budget Reconciliation Act) offers the most obvious solution.
COBRA guarantees that you can temporarily remain under your employer’s health plan after the loss or reduction of employment. And while this sounds like a saving grace, the reality is less-than-perfect.
Does COBRA Apply for You?
Although COBRA allows for the continuation of coverage when it would otherwise be terminated, there are still eligibility requirements, according to the U.S. Department of Labor.
First, the insurance plan you’re already signed up for must include COBRA, which is fairly common: if coverage is provided by a company with more than 20 regular employees (working at least near full-time) or a local government body, COBRA should apply. However, COBRA is not supported by federally-sponsored or church-related health plans.
Second, there must be a defining event that causes your loss of coverage — you’ve suddenly lost too many work hours to qualify, for example, or perhaps you’ve lost your job altogether. Other situations not directly related to work are also permitted, such as divorce or the death of a spouse when you’re covered under his or her company’s insurance.
The third requirement is that you are a qualified beneficiary the day before losing coverage. For people without existing insurance, COBRA is never an option.
The Downside of Continued Coverage
While COBRA serves an important purpose, it’s far from a perfect program. Remember, COBRA coverage is temporary, and its intention is to provide leeway for getting back on your feet.
As such, employers are only required to keep your plan intact for 18 to 36 months, so depending on COBRA for the long haul will ultimately leave you stranded.
Another important factor is price. Under COBRA, all of the fees normally paid by your employer may now be sent to you. Coverage isn’t guaranteed, either — if your premiums aren’t paid on time, consider you and your family out of luck. And if your company loses its coverage, then so do you.
A Better Route
If you want an option that avoids premiums, sign-up fees, and limited-time coverage, SingleCare is your answer. SingleCare is not an insurance company; it’s a comprehensive support network that provides direct access to immediate, quality care at discounted rates.
You can view cost estimates before making appointments, and you only pay for the treatment you receive. With SingleCare, you won’t ever be dropped for missed premiums because there are no premiums to begin with.
With or without insurance, our extensive network of physicians and specialists maximizes your chances of finding a doctor that’s right for you, and at a price you can afford. Services are offered at rates discounted up to 50% on the original procedure price.
When employer coverage falls through, COBRA isn’t your only option — there are now more affordable, dependable alternatives.
(Main image credit: Vic/flickr)