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How Many Days Do I Have to Work to Qualify for COBRA insurance?

Posted on: April 30th, 2012 by Cobra Insurance Guide

reduce cobra insurance costsDear COBRA Insurance Benefits,

I recently got a new job, but found out that I am going to have to leave the job due to family issues. However, I really need the health insurance from the new job and will need to continue it on COBRA since my husband has a pretty serious health condition. I have only worked there for 30 days and am curious about how long I need to work at my company to qualify for COBRA insurance? Is there a minimum amount of time? Could I get COBRA insurance already? Thanks.

In Need of COBRA Insurance

This is a great question and actually one that many people have recently emailed us about. The answer is actually surprisingly simple. If you are currently getting health insurance from your company and meet the COBRA insurance requirements, then you qualify for COBRA insurance. That applies to both your coverage and your family’s COBRA coverage assuming you meet the requirements.

So what if you don’t currently get health insurance from your company? Then you are not going to be able to get COBRA insurance yet. Many companies have between a 30-90 day window before health insurance starts for a new employee. If you are still in that window then either you have to wait until your health insurance starts or will not qualify for COBRA.

The High Price of COBRA Insurance and Preexisting Conditions

Posted on: April 26th, 2012 by Cobra Insurance Guide

No family ever predicts that a serious medical condition will hit their family, but sometimes it happens. Families suddenly find themselves facing decisions they never expected and many times facing health insurance bills they can’t fathom. Making this situation all the more complicated is that many times in the face of serious illness, people are forced to quit their job to care for their loved ones, and that’s when COBRA insurance comes into play. For some people COBRA insurance can be an incredible option in this situation, but for others, it can quickly become more expensive than they could ever imagine. To help understand this better, let’s look at two different families in similar situations, but apt to make very different decisions.

Our first family recently found out their son had cancer and will need almost around the clock care during his treatment. His mother is happy to provide that and preparing to quit her job in order to take care of her son. Her husband is self employed and does not have health insurance. Previously the entire family used her health insurance. Unfortunately, her company recently needed to cut costs and drastically changed their health insurance plan. The HMO has a deductible of $30,000 per family per year and the premiums have skyrocketed. While she was employed, her employer continued to cover 80% of the cost. After quitting her job and looking at her COBRA election form, she learns that health insurance for her family will cost over $7500 monthly due to the lackluster health insurance plan and her son’s condition. That is over $90,000 annually plus the $30,000 deductible which they will definitely use given her son’s condition. In all, her family will spend $120,000 this year on health insurance, a number they can’t afford.

Our second family also recently found out that their oldest daughter has a serious stomach condition and will need weekly medical care. She also will need constant care at home for at least the first 6 months. Facing the same decision, the family decides that they will stay at home to care for their daughter and use COBRA insurance coverage for the 18 months. Luckily for this family, the health insurance plan they are using is very good. Even with COBRA insurance they will spend $1500 monthly for their health insurance with no deductibles and minimum co-pays. Given their child’s preexisting condition, they know this is the best rate they can get.

So what can the first family do? It wasn’t there choice for the insurance plan to change and there is no way to afford $120,000 in medical care. Right now, they have a few options to cut their costs. First, they can consider only ensuring their son with COBRA and moving the rest of the family to an individual plan. This will cut some of the costs, but probably not drastically enough. Secondly, they can look to put their son on a pre-existing condition plan, or PCIP, and look for the lowest rates available. They will not be cheap but they will likely be less than COBRA insurance. Finally, they can explore government and state insurance plans and see what their options are. Depending on the state there may be options that can help cover the costs. Another option, finding part time work with health insurance. Starbucks for example offers health insurance to it’s part time employees.

Is COBRA Insurance Right For Me?

Posted on: April 25th, 2012 by Cobra Insurance Guide

COBRA Insurance and Taxes

COBRA insurance is a great health insurance option for people who are absolutely sure they will soon have health insurance again, have preexisting medical conditions that make it difficult to qualify for other health insurance plans, or can financially afford to keep their current plan and benefits. However, for most of us, COBRA insurance many not be the best option and there may be alternatives that can provide us with similar coverage for much less money.

To better understand is COBRA health insurance is right for you, let’s first take a look at who is eligible for COBRA insurance.

Qualified Employee Beneficiary Qualifying Event Cost Term

Previous employer had at least 20 employees

Previous employer had a health insurance plan

Previous employer was not the federal government

Employee, spouse, and/or dependents Voluntary (quitting, retiring) or involuntary termination of employment OR reduction in work hours 102% of the entire health insurance premium 18 months
Employee, spouse, and/or dependents Termination OR reduction of work hours along with a disability certified by the Social Security Administration 102% of the entire health insurance premium for first 18 months, 150% for next 11 months 29 months
Spouse or dependent children Death of employee, Divorce or legal separation, Loss of “Dependent Child” status, OR Employee enrollment in Medicare 102% of the entire health insurance premium 36 months

Once you know if you are even eligible for COBRA, the next decision is whether or not COBRA insurance is right for you. Generally you should consider COBRA health insurance if you are:

  • Have a preexisting condition
  • Have been declined from health insurance plans in the past
  • Are pregnant or plant to become pregnant in the near future
  • Take expensive prescription medications
  • Will be undergoing a medical procedure in the near future
  • Normally need lots of medical care

On the other hand, there are many instances when COBRA insurance may not be right for you. Those include:

  • Families and individuals in good health
  • People who will need insurance longer than the term given with COBRA
  • People who can’t afford COBRA or want a cheaper option
  • People who know they will soon be employed and want a cheap, short term option

Additionally it is always important to remember that you can make individual decisions for different family members depending on your needs and budget. If only one family member has a preexisting health condition, you may sign them up for COBRA insurance and then sign the rest of your family up for a more affordable individual health insurance plan. COBRA insurance can be used for the entire family or just particular members. It can also be dropped at any time.

How to File a COBRA Insurance Claim

Posted on: April 23rd, 2012 by Cobra Insurance Guide

reduce cobra insurance costs

Since COBRA insurance is a continuation of the health insurance plan you had while you were working, the rules to follow a claim are going to be the same as they were when you were employed. Normally this includes a written document that must be submitted to the insurance company along with receipts for the medical expense. Generally insurance plans include this information in the Summary Plan Description.

Under most health insurance plans, whether they are a continuation with COBRA insurance or not, you will have a certain about of time to submit your claim and dispute your claim if needed. Most plans give you 90 days to submit your claim and in turn will let you know the status of your claim within 90 days. If it is accepted, you can expect to receive reimbursement, if it is denied, you can dispute it. For most plans you have 60 days to dispute the claim.

If you are using COBRA insurance and unsure about how to file a claim, you should contact your health insurance company for more information. They can provide the most accurate information on how your specific COBRA insurance plan works.

COBRA Dental Insurance

Posted on: April 4th, 2012 by Cobra Insurance Guide

COBRA Dental Insurance

COBRA Dental Insurance is an option many people wonder about when they lose, quit, or retire from their job and are considering COBRA insurance. In many cases people who had dental insurance coverage as a part of their health insurance plan, can continue their dental insurance with COBRA if they qualify under the federal requirements. However in some cases if the dental plan was an additional or optional add-on, or completely separate plan it will not be covered under the federal COBRA insurance laws. Even if you are covered under COBRA dental insurance, you still may want to consider outside dental coverage which can be significantly cheaper than COBRA dental insurance.

If you are considering COBRA Dental Insurance, you should also get a quote for private dental insurance. If you do not have serious dental conditions, it is likely you can get a much cheaper rate than with COBRA insurance. COBRA insurance is expensive since you must pay the entire premium yourself, without employer support, and a 2% administration fee. This normally doubles or even triples the amount you are used to paying. With a private dental plan most people find they can find a plan for 65% less than their COBRA Dental Insurance plan. You can get a free dental insurance quote here to find out what type of dental insurance you may be able to buy. Compare that cost to the cost of COBRA Dental and determine which is the best option for you and your family.

California COBRA Insurance – Cal COBRA Insurance

Posted on: April 2nd, 2012 by Cobra Insurance Guide

Stethoscope and Pen

Knowing the difficulty of job loss and health insurance, following the federal government’s lead, California created it’s own mini COBRA insurance plan known as California COBRA insurance, or Cal-COBRA insurance. This plan, much like federal COBRA insurance, was set up to make sure people didn’t suddenly go without health insurance after they quit, lost, or retired from their job. In addition the law protected people losing health insurance from divorce or from losing dependent status as well. Under both the federal and Cal COBRA insurance laws, people have the option to continue to use their employer sponsored health plan for up to 18 months in most cases if they meet the requirements in the law. That means that they could keep the exact same doctors, prescription plans, co-pays, and deductibles. The catch? Under COBRA and Cal-COBRA, the individual or family who signs up for COBRA is responsible for paying the entire premium without any subsidy from the employer. In addition, they also must pay a 2% administration fee.

Understanding Federal COBRA Insurance

Under the federal COBRA insurance bill, in order to qualify for COBRA insurance you must meet three requirements known as qualifying plan, qualifying event, and qualifying beneficiaries. The qualifying plan refers to the type of health insurance plan that you had while you were employed. For federal COBRA insurance, this plan must have covered at least 20 employees to be eligible. The second requirement, known as qualifying event, refers to the way that you lost health insurance coverage. In most cases if you lost, quit, or retired from your job and there was not gross misconduct you will qualify. This also includes spouses who are losing coverage due to divorce and children who are losing health insurance due to losing dependent status. The final criteria, qualifying beneficiaries, refers to who is able to elect COBRA insurance. In most instances anyone who was on the health insurance plan will be able to be on COBRA insurance.

Understanding Cal COBRA Insurance

Cal COBRA was created to make sure that more people in the state of California could qualify for COBRA insurance if they wanted it. Essentially what the Cal COBRA law does is extend the benefits to people working at companies with between 2-19 employees. It also at times extends beyond typical COBRA insurance coverage and may last up to 36 months. Like federal COBRA insurance, an individual or family must pay the entire cost of the health insurance plan plus a 2% administration fee to keep coverage.

Cheaper Options to COBRA Insurance and Cal-COBRA

Since COBRA insurance can be so expensive, usually around $1000 for a family of four, it is important to consider other health insurance plans that may be more affordable. This is especially true if you and your family are relatively healthy. Many people find by looking at private health insurance cost they can save up to $600 a month on their health insurance costs. The easiest way to find out what you might qualify for – get a free health insurance quote online and explore your options. It will show you what plans you are eligible for and their costs.

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