Overpaying For Cobra Health Plans?
If you are like millions of Americans on Cobra you are probably paying sky high health insurance premiums. Along with your health premiums being high, you most likely have a high deductible health plan just so you can afford the monthly premiums. Right now might be a good time to shop around for alternatives.
If you lost your job and need health coverage, you dont have to pay an arm and a leg for continued coverage- there are less expensive alternatives for you to keep your family protected. With COBRA you pay all the health premiums yourself, with health insurance premiums that could exceed $1000.00 per month.
This is how the United States Department of Labor defines COBRA: the Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce, and other life events. Qualified individuals may be required to pay the entire premium for coverage up to 102 percent of the cost of the plan.
One thing that is very important to remember when you have medical insurance through an employer. YOU do not have health insurance. Your family also does not have health insurance. You have a job that provides you with insurance and if you lose that job you will no longer have protection from major medical expenses. I guess you could say your job has health insurance. Also, doesnt it seem a little crazy that you could lose your source of income and then be expected to pay up to 102% more for insurance?
There are some cost effective alternatives that will protect you and your financial assets. One of the alternatives you should not choose is to go without medical insurance. Seventy percent of bankruptcies in the U.S. are due to unpaid medical bills.
Another issue is continuation of coverage for pre existing medical conditions. A lot of people think that if they have group insurance as long as they replace that within 63 days of losing their jobs that all pre existing conditions will be covered. That rule only applies to another employer sponsored group plan. It does not apply to individual medical insurance that is underwritten. You must qualify for individual plans by meeting certain health requirements. If someone tells you that the insurance you are thinking about buying is guaranteed issue it is not underwritten and not a major medical policy.
Your options for individual coverage are:
Major medical coverage. Doctor copayments, prescription coverage and well care checkups usually without having to meet the deductible. Surgical and hospital coverage after the deductible is met. These plans are the most like your group insurance.
Catastrophic Health Insurance. These policies have a very high deductible, like $10,000 and some as high as $25,000.00. Typically they do not pay anything until you meet the deductible hence the name.
Short term major medical. Pick these as a last resort. They will usually have a choice of deductibles starting around $1000.00. They also do not pay for anything until the deductible is met, but the underwriting is very limited. These policies must be renewed every 6 to 12 months.
If you lost your job and need health coverage, you dont have to pay an arm and a leg for continued coverage- there are less expensive alternatives for you to keep your family protected. With COBRA you pay all the health premiums yourself, with health insurance premiums that could exceed $1000.00 per month.
This is how the United States Department of Labor defines COBRA: the Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce, and other life events. Qualified individuals may be required to pay the entire premium for coverage up to 102 percent of the cost of the plan.
One thing that is very important to remember when you have medical insurance through an employer. YOU do not have health insurance. Your family also does not have health insurance. You have a job that provides you with insurance and if you lose that job you will no longer have protection from major medical expenses. I guess you could say your job has health insurance. Also, doesnt it seem a little crazy that you could lose your source of income and then be expected to pay up to 102% more for insurance?
There are some cost effective alternatives that will protect you and your financial assets. One of the alternatives you should not choose is to go without medical insurance. Seventy percent of bankruptcies in the U.S. are due to unpaid medical bills.
Another issue is continuation of coverage for pre existing medical conditions. A lot of people think that if they have group insurance as long as they replace that within 63 days of losing their jobs that all pre existing conditions will be covered. That rule only applies to another employer sponsored group plan. It does not apply to individual medical insurance that is underwritten. You must qualify for individual plans by meeting certain health requirements. If someone tells you that the insurance you are thinking about buying is guaranteed issue it is not underwritten and not a major medical policy.
Your options for individual coverage are:
Major medical coverage. Doctor copayments, prescription coverage and well care checkups usually without having to meet the deductible. Surgical and hospital coverage after the deductible is met. These plans are the most like your group insurance.
Catastrophic Health Insurance. These policies have a very high deductible, like $10,000 and some as high as $25,000.00. Typically they do not pay anything until you meet the deductible hence the name.
Short term major medical. Pick these as a last resort. They will usually have a choice of deductibles starting around $1000.00. They also do not pay for anything until the deductible is met, but the underwriting is very limited. These policies must be renewed every 6 to 12 months.
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