The Cost of COBRA is Relative

18 Mar

Posted by: Cobra Help Center in: COBRA Health Insurance

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Measuring the cost of health insurance can be an eye-opening experience. In this era of rising health costs, all employees, their spouses and even their dependents are aware of the cost of health insurance. There is no such thing as a low cost health need. Unfortunately, most individuals do not give much thought to the cost of health care until they are faced with the possibility of losing their health insurance. Even then, the cost of COBRA coverage compared to the value of Cobra health insurance is often misunderstood.

The cost of Cobra health insurance is regulated. But, if the individual participated in a group plan, the cost of COBRA far exceeds the individual’s previous cost experience. Persons who elect to continue their Health Plan through Cobra may be required to pay up to 102% of the premium cost. The COBRA premium amount does not need to be paid in a lump sum and can be paid on a monthly basis. Basically, the insured pays the full monthly premium plus a 2% administration fee.

This reality can be discouraging and causes many individuals to reconsider their ability to continue their health plan. For persons who are between jobs and collecting unemployment, or who are waiting for a new health plan to commence, or who are in a divorce, or who are a dependent who has aged beyond the health plan’s dependent age limit, COBRA health insurance can help. There are compelling reasons to elect to continue health coverage through COBRA.

Persons who become ill, or have an emergency health issue or persons who have a pre-existing health condition will be glad to have COBRA coverage. Most likely these persons will be less concerned with the cost of the plan than with the availability of covered services by their COBRA health plan.

Doubtless, the cost of COBRA health insurance will become a household budget issue, but the simple reality is that COBRA insurance is less expensive than the costs related to an uncovered medical event. These expenses can cause families serious financial difficulties including bankruptcy, loss of the family home or even an inability to procure necessary health care.

When individuals consider COBRA coverage, they usually evaluate the risk of being uninsured and evaluate their current medical history including pre-existing conditions. Persons whose medical insurance lapses may lose coverage for pre-existing conditions when their next health plan begins.

Too many families make ill-advised decisions about exercising their COBRA coverage. Rather than think first about what the coverage will cost, persons considering COBRA should carefully evaluate the potential cost of normal health prevention or a health emergency. When weighing those risk factors, the cost of COBRA health insurance is much more reasonable.

Perhaps the most valuable aspect of COBRA is the peace-of-mind offered by the coverage. There is no denying the expense of COBRA premiums, but that cost is minimal compared to the advantages.

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Posted in: COBRA,Relative