COBRA Payments Expire For Many

Tuesday, December 1, 2009
Topics: Economy
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Thousands of out of work Ohioans lost a federal subsidy today that dramatically reduced premiums for health insurance benefits extended to some laid-off workers by their former employers. Ideastream®'s Rick Jackson reports.

The subsidy, passed by Congress as a $25 billion piece of the economic stimulus package, covered up to 65% of insurance payments for people using COBRA. That’s the vehicle through which eligible laid off workers can still buy health insurance through their former employer for up to a year and a half. 

Problem is...most laid off workers can’t afford the normal premiums and that’s why the federal government stepped in to help during this recession.  The subsidy was funded though only for nine months, starting last march.  So, those who started getting the benefit then, lost them December first.  It’s unclear exactly how many people are affected because no agency tracks the numbers. 

Health advocacy groups such as Families U-S-A are pushing for an extension of the subsidy program.
Ron Pollack is Executive Director of the Washington, D.C. based group.

RON POLLACK: “for those people who lose the subsidy, undoubtedly the overwhelming majority of them will become uninsured.”

Families U-S-A says Ohio families paid just over a thousand bucks a month for COBRA insurance; that’s more than 71% of the average monthly unemployment benefit. As high as that is, people in 44 states pay even larger percentages than Ohioans.

Ohio’s Sherrod Brown is one of five U.S. senators sponsoring legislation to extend COBRA subsidies. Their bill would also increase the government’s share to 75% of costs but even supporters say passage is not expected until next year at the earliest.

Additional Information

The Families USA report