How do i get Insurance Coverage being Unemployed

The Impact of the Stimulus Package on COBRA

For the millions of people laid-off from jobs; finding another job, feeding themselves and their family, and paying bills are major concerns. However, another primary concern is that of continuing health insurance coverage.

The $787 billion economic stimulus package signed into law by President Obama, in an effort to heal the economy, does include provisions for the unemployed in respect too health insurance. However, it is applicable only to those who involuntarily lose their jobs between the period of September 1, 2008 and December 31, 2009.

The word cobra usually connotes fears of a deadly nature in respect to the world’s biggest venomous snake. However the acronym COBRA is completely the opposite; since it offers a chance of health care and life for the unemployed; by allowing them to continue their health coverage for a certain period, while they are out of work.

COBRA is the acronym for the Consolidated Omnibus Reconciliation Act of 1985.The stimulus package has a significant effect on this Act; by making monthly payments for the unemployed more affordable. Qualified beneficiaries for a reduction in payments are those laid off between September 1, 2008 and December 31 2009; and who elect COBRA coverage. Dependents of those employees also benefit from the new provisions.

Under this new provision, the employer may contribute 65 percent of the premium cost, so that the beneficiary would contribute only 35 percent. This employer contribution would apply for the first nine months of the COBRA coverage. The employer can increase the employee share of the premium after this period. Moreover, if the qualified beneficiary becomes eligible for coverage under another group health plan or Medicare, the employer contribution would terminate.

The subsidy is expected to become effective from March 1, 2009, so new notices will be sent out informing beneficiaries of this new move. An additional election period is expected to be offered by employers to persons enrolled from February 17, 2009, and also to those who previously declined COBRA as well as those who elected, and later terminated COBRA coverage.

Employers have been directed to send out the additional election-period notices on or before April 18, 2009. Former employees who had not yet elected COBRA will then have 60 more days after receiving the notice to elect coverage. In the event that some former employees do not receive notices on time, and they pay 100% for the first month or more after the subsidy becomes effective by the Act; subsidized portions of the premium are expected to be either credited to them, to be used within 180 days; or refunded within 60 days.