Everything You Need To Know About Cobra

With many people presently experiencing the hardship of losing employment because of cut-back induced lay offs, the need to educate insured workers on their choices upon receiving their pink slips is immense. Health care continues to be a hot topic in the political world, however this political atmosphere in no way entrenches upon the rights of a laid off worker to keep their health care coverage via the COBRA plan.

 What Exactly is COBRA?

 The Consolidated Omnibus Budget Reconciliation Act enacted in 1986, was created to explicitly to prevent immediate insurance coverage from expiring following termination of employment. COBRA allows for a worker that lost their job to apply for COBRA insurance within a period of 60 days following loss of employment. Following this 60 day period, COBRA insurance will no longer be available as an option.

 Expense of COBRA

 COBRA insurance provides the exact same quality of insurance coverage that was available as a current employee but can be significantly more costly, as the ex-employee must provide for the employer subsidized amount as well as their own share of premium costs. This total cost is often amended by a 2% administrative fee that is tacked on by employers, as well.

 A quick illustration of a cost shift to COBRA that would occur in an household would be that of an employee originally paying a $300 dollar premium each month for health coverage. If said employee was only paying 30% of the total cost-$300-and their employer was covering the remaining 70%-$700-then COBRA coverage cost would amount to $1000 monthly, plus the 2% fee-if applicable.

 What if COBRA is just too Expensive?

 The time period to choose upon enrolling in COBRA coverage-60 days-is designed to allow an ex-employee to review their alternatives following loss of employment. A healthy family, for example, might choose to enroll in a high deductible, low premium cost health coverage plan until a more suitable plan may be obtained through future employment.

 Health Care Reform COBRA Changes

 The patient Protection and Affordable Care Act passed in March 2010 does not explicitly make changes to COBRA coverage, in that its primary goal was to address adequate health care coverage for those that lack it. 2014 will, in fact, entail a change to COBRA however, as it allows employees to obtain insurance exchanges and therefore obtain different health insurances via providers other than that of their employers. 2014 will not change anything else about COBRA, as the calculations for COBRA coverage will be the same, and employers will continue to subsidize standard employee coverage the same way.  

Choosing The Right Coverage For Health Insurance In California

In the upcoming months, next few years, and time to follow, health insurance in California is set for some staggering changes. Sweeping transformation brought on by legislative amendments and court decisions means big changes, mainly by introducing a new marketplace concept in California that will be available in 2014. Under law, essential health benefits must be provided, including maternity care, emergency, certain mental health needs, and specific hospitalization services. Beyond these, more complex considerations come into play when deciding what levels of coverage suit specific needs. One of the first issues to come up is cost associated to the new plan. First and foremost, individuals will now be provided assistance in various ways if essential health care is cost prohibitive and out of reach. Mainly, tax crediting, cost sharing based on household income, and expansion of the Medi-Cal program. Covering the basic health care needs, the market then becomes open for individuals and families to explore what health care insurance options best suit their lifestyle and budget.

 Starting in 2014, health insurance in California will be offered from 4 federally designed basic levels of coverage. Costs will primarily be determined on the exchange depending on how many people in a household require coverage, their ages, and annual household income. Platinum and gold coverage are the highest levels and most comprehensive and expensive options for coverage. This translates to less copays across the board and a less up of an upfront or out of pocket expense when gaining most medical services. The silver plan attempts to strike the middle ground balance between affordability and flexibility. There is also a lower cost sharing option available on a sliding scale within the silver plan. The bronze plan is offered for individuals looking for basic coverage just beyond basic care and catastrophic coverage will be available to those 30 years of age or younger.

 In light of these changes, individuals and families are faced with important decisions to help secure a healthful future. Determining budget, balanced with needs and values will play a crucial role in the factors leading up to the decision regarding what level to choose. Attempting to strike a balance with affordability and availability, careful assessment of what each plans includes and extends to cover will also be crucial. Assistance is already, and will be widely available to help understand the different levels available and what will best balance these factors. As technology charges forward, information regarding health insurance in California will also be easier to access and understand. Online tools such as calculators, web-based assistance programs, and organizations designed to provide the best and most accurate information will also be a mouseclick away. Staying informed, having questions answered early, and knowing the facts is the best way to ensure a right choice is made, especially when considering the introduction of window enrollment periods. Whether its platinum, gold, silver, or bronze, becoming the best advocate for yourself and family through information and knowledge will serve as the best tool while California continues to reshape health insurance programs.