COBRA – Snake-bit as a health safety net
By Consumers Union on Tuesday, January 13th, 2009
The latest dreaded unemployment numbers came in last week – another 500,000-plus lost jobs in December. And as many of those former workers are sadly discovering, their hoped-for safety net of COBRA health insurance is just too expensive to afford.
Families USA clearly laid out the jobless problem in a new report. In most states, unemployment benefits barely cover the monthly COBRA premiums – the national average unemployment check is $1,278, while the health insurance premium rings in at $1,069 a month for family coverage.
In some states, including my home state of Arizona, the monthly $937 in unemployment doesn’t even cover the family COBRA premium. No matter how much you salt and pepper it, you can’t eat a COBRA policy, and landlords aren’t keen are taking it to cover the rent. So those states looking to make up their huge budget deficits by cutting back on health care for the poor (as Arizona and probably your state is doing) may soon see thousands more unemployed residents knocking on their door for help. And they’re in no hurry to answer.
The horrible economy clearly illustrates the weakness of the COBRA safety net. A net doesn’t work when it’s too expensive to lay out. If you’ve had to go on COBRA, tell us in the comment section below how it works in your monthly budget.
While the proposals on the table are helpful and desperately needed – government subsidies to help pay COBRA premiums, extending the 18-month COBRA limit, or letting laid-off workers temporarily enroll in Medicaid with the federal government picking up the full tab – they remain temporary fixes to a very real and growing problem.
Not to beat a dead cobra, but it’s worth saying again: Reviving this economy means giving Americans back their financial security — including making available the health coverage they need, when they need it, at a price they can afford.