COBRA was the plan offered to employees who had left their job in order to continue those benefits as not to be left without health insurance between jobs. Most of the people that exercise this plan are medically forced to as they could not obtain the same coverage on their own.
The other event which would make the continuation of benefits attractive would be for the older people in a group health insurance plan whose premiums are lower due to the average age of the group being lower than their age. Thus, for most people in their late 50s to age 64 should continue with COBRA if it is medically necessary.
The Dangers Of COBRA In Florida Health Insurance
That being said, COBRA can also become your worst enemy if you elect it as a healthy person and during the 18 months you are covered under you were to become uninsurable due to a medical event. At this point, your Florida COBRA Health Insurance Plan would end and you would be forced to either elect a HIPAA plan or a conversion plan from your COBRA health insurance company, if you were lucky enough that they had one or if you stayed in the same state as when you had the job. Of course, either a HIPAA Conversion plan or COBRA Conversion plan would mean you were no longer protected by the younger people in your group and would now be paying the highest rates in the country.
HIPAA Conversion Policies
The companies do not want to offer these conversion or HIPAA plans, but have to because they are mandated to when they agree to become Florida Health Insurance companies. I have personally seen people paying as much as $2000 for a single person on a conversion plan of this type with a high deductible.
At East Coast Health Insurance we would recommend you call us if you fall into either the COBRA, HIPPA, or conversion plan groups as you are most likely in a situation that can be easily fixed. If you are uninsurable and now have your own business we can set up a group plan or we can direct you to any of 8 government agencies that will save you money on premiums. Because even though you might be paying these premiums faithfully the health insurance companies know that once you should become incapacitated you would no longer be able to afford these premiums and would then have to terminate your policy anyways. There is absolutely no reason to not call us if you are in a situation like this. Please call us anytime at 888 803 5917 for more information or email us or even come into our office and sit down and let us fix your situation for free. And remember these situations have no broker commissions so this our good deed which are always rewarded with referrals galore.
Below is an important COBRA update in light of the recession that should apply to almost everyone on COBRA in Florida. Please read it immediately.
Below, you will find a synopsis of the American Recovery and Reinvestment Act (ARRA) – a program which, amongst other things, provides much needed assistance to those who have recently lost their employer sponsored health insurance coverage by subsidizing 65% of their insurance premiums for 9 months.
In a nutshell, an individual who is terminated from their employment and is eligible for COBRA is subsequently eligible for premium assistance for themselves and their family. Of course there are stipulations in the bill conveying tax ramifications, but I will not get into all of that, instead I will only say that before electing this coverage and earn more than $125,000 you’ll probably want to read the section titled Recapture of Subsidy for High Income Individuals.
I foresee one problem, people will not be aware that this coverage is available although it clearly states in the bill the persons who are in charge of solely that function. That is, educating employers, the public, etc that this premium assistance is available and in Florida also available to groups of less than 20 employees. However, this premium assistance for COBRA benefits needs to be elected by the individual – I come across MANY people who aren’t even aware of their eligibility or rights with regards to COBRA.
This bill will be effective from September 1, 2008 through December 31, 2009 and the employee has 90 days to elect this assistance by notifying the group health plan in writing…so all we need now is to let people know what COBRA is, let them know if they are eligible, let them know that this assistance program is available and that they have 90 days to elect it – what’s that, ‘you were laid off 4 months ago’..oh no, that’s awful, but true. I’m sure if I kept reading through those 400 pages I would’ve found something on retroactive coverage. But you see my point, okay… assuming this is brand new, okay great, you were just laid off – you have 90 days to notify the group health plan in writing that you want to elect this assistance. Fast forward, 4 months later they thought it magically happened or they procrastinated for too long or they didn’t feel like writing a letter or couldn’t find the address where they were supposed to mail it to…
For those who have lapsed in coverage and are looking for cost effective coverage compare quotes and apply online for an individual or family health insurance plan today.
View the entire bill for this act here American Recovery and Reinvestment Act (ARRA)
You can also access that bill along with other pertinent information with respect to COBRA and this particular act here.
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