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Is COBRA a Good Option For You?

Posted on: September 24th, 2012 by Kristen Marie

nurse and child

Most people have a million things on their minds when they lose their jobs – How I am going to pay my bills? How do I find another job? What do I do now? and eventually What am I going to do about health insurance? Is COBRA right for me? It’s a scary position to be in and can feel very overwhelming. But hopefully we can help alleviate some of the stress about determining what to do about health insurance and COBRA.

COBRA is best for…

In most situations COBRA insurance is best for people who:

  • Have a preexisting condition and are likely to be denied from other plans
  • Are pregnant or plan on becoming pregnant
  • Have had surgery recently or plan to have surgery in the near future
  • Have been denied from a health insurance plan before
  • Lead a high risk lifestyle
  • Are over the age of fifty who may be denied from another plan
  • Take expensive medication
  • Can afford the premiums and do not want to deal with a change in insurance

A COBRA alternative is best for….

Alternatively there are many people who don’t necessary need COBRA and can likely save money if they find a new plan. You should look at an alternative to COBRA if:

  • You are young and generally healthy
  • You do not use your health insurance often
  • You do not have a preexisting condition
  • Qualify for state or federal health insurance
  • You can use a spouse’s insurance plan
  • You want to save money

Filing a COBRA Insurance Claim

Posted on: September 13th, 2012 by Kristen Marie

Filing a claim for COBRA health insurance benefits can feel intimidating the first time you do it, but since it is just a continuation of the insurance plan you had, all you have to do is follow the same procedure as when you were employed. For most insurers this will include saving a receipt, filling out a written insurance claim form, and mailing the form and receipt into the insurance company. Reimbursements usually take 4-8 weeks for processing.

If you waited to sign up for COBRA insurance until the end of the sixty days window for enrollment and incurred medical expenses during that time, you can also submit reimbursements and claims to your COBRA administrator because COBRA is retroactive. Since COBRA is retroactive back to the date you lost coverage, everything is covered during that 60 days. Follow the procedure in the Plan Summary Guide from your insurer to submit a claim correctly.

If you want to make a claim against your employer for failing to send you an enrollment form or making another mistake with you COBRA coverage, you can contact the Department of Labor who oversees all issues with the COBRA law, or Consolidated Omnibus Budget Reconciliation Act.

Health Insurance Options After Graduation When You’re Unemployed

Posted on: September 12th, 2012 by Kristen Marie

Dear COBRA Insurance Direct –

So here is my situation. I am 23 years old and just graduated college, but like many of my classmates I still don’t have a job and really need health insurance. I go to the doctor often and know I can not afford the cost with a health insurance plan. What options do I have? Can I sign up for COBRA insurance? I am pretty healthy overall, just prefer to have a full coverage plan. Thanks.

Truly,
Unemployed with Degree

Dear Unemployed with Degree,

It sounds like you are in a difficult situation, but at least you are not alone. Many college graduates these days find that it is much harder to find a job than it was in the past and also find themselves pondering difficult health insurance decisions. Based on your situation, you actually probably have more options than you think for health insurance while you look for a job.

  1. Keep Using Your Parent’s Insurance: Under the recent health care legislation, you can use your parent’s health insurance up to the age of 26 years old now. Even if you haven’t been on it because you used university insurance, you could sign up again during open enrollment. If your parent’s are averse to the extra cost, offer to pay your share because it will still likely be better coverage and less expensive than anything else.
  2. Look for an Alumni Insurance Plan: Many colleges and universities have started offering health insurance plans for alumni that they can use. These plans can usually offer a better rate than a private plan since they are covering more people. Inquire at your school to find out what is available for recent graduates.
  3. Consider COBRA Insurance: If your parents recently qualified for Medicare, lost their job, or had another qualifying event, you qualify for COBRA insurance for up to 36 months. However you must notify the employer and plan if you are in this situation immediately and sign up within 60 days of the event happening.
  4. Look at Private Plans: Given you said you are relatively healthy and you are young, you can probably get a very good rate for a private insurance plan. These plans have a reputation of being very costly but for someone who is young and healthy, you can likely find a full coverage plan for under $200 a month.

Can I Use Both Medicare and COBRA?

Posted on: September 10th, 2012 by Kristen Marie

doctor and elder patientDue to the difference between Medicare coverage and COBRA coverage, many people want to know whether or not they are able to use COBRA and Medicare at the same time.  And the answer isn’t that simple unfortunately.  It depends on both why you qualified for Medicare and when you enrolled in COBRA coverage.

For people who qualify for Medicare coverage because of their age or a disability, being able to use both plans will be based on when you enrolled in COBRA and which plan you had first.

  • For people who were on COBRA insurance plans before they enrolled in Medicare, in most situations COBRA ends when you start Medicare.  If you already have COBRA when you enroll in Medicare, your COBRA coverage usually ends on the date you enroll in Medicare. However, if you are already on COBRA and become eligible for Medicare, it is always smart to enroll in Medicare Part B right away.  This is because there is no special enrollment period when your COBRA coverage comes to an end.  Any dependents or spouses on COBRA will be able to use it for up to 36 months due to your Medicare qualification.
  • If there are certain things that your Medicare plan does not cover, but your COBRA plan does cover, you may be able to keep a portion of your COBRA plan.  A common example of this is when someone has dental insurance through COBRA but Medicare doesn’t have the same dental offering.  Many plans will allow you to only keep the dental part with COBRA.  To find out if you are eligible, you should contact your health insurance administrator.
  • For people who are already on Medicare and then lose their job (or have another qualifying event) and become eligible for COBRA coverage, you are allowed to sign up for COBRA.  This right is part of ESRD, and in this situation Medicare will be the first plan to pay for any services and then COBRA will pay after that.  The reason to take COBRA in this situation would be due to high medical costs that Medicare doesn’t cover but your COBRA plan would.

Additionally it is important to understand that people who are eligible for Medicare (due to ERSD), have a 30 month coordination period when the employer’s group health insurance plan pays first and then Medicare pays second.  For people enrolled in COBRA during this 30 months window, COBRA health insurance will be the primary insurer.  When COBRA ends, which is likely to happen within that period, Medicare will then take over.  If your COBRA coverage does not end in the 30 months for some reason, then the positions will simply swap and Medicare will become the primary insurer.

Church Plans and COBRA Insurance

Posted on: September 7th, 2012 by Kristen Marie

doctorsDear COBRA Insurance Direct,

For the last five years I have worked with my church and they have provided me with a health insurance plan for my family.  I just had another child and will need to leave my church position so I can stay home with the new baby.  Am I able to use COBRA to continue the health plan I had with my Church?  I am really worried about keeping my health care. 

Sincerely,

Worried at Church

Dear Worried At Church,

In most cases the federal COBRA law does not cover church insurance plans so likely it will not be an option for you to continue your plan with COBRA.  However even though this isn’t normally an option it is still a good idea to contact the health plan administrator to double check.  They will be able to tell you immediately if your plan is eligible.

If you learn that your plan is not eligible for COBRA, then you will need to look into alternative plans.  Depending on your health care needs you could consider a private family plan, a high deductible plan, or a government plan.  The private family plan will provide similar coverage, likely at a lower price, to what you had with the church.  A high deductible plan will only cover emergencies.  The governmental plans vary by state but most likely are a good option for your children and can provide free or lower cost care.  Good luck!

What are Independent Election Rights With COBRA?

Posted on: September 6th, 2012 by Kristen Marie

doctor and patientUnderstanding the language in your COBRA election form can be difficult and most people find themselves looking for a dictionary just to understand what their options are.  One question we frequently hear from people is in regards to Independent Election Rights and what that means.  COBRA insurance independent election rights refer to the ability to choose who signs up for COBRA and who does not independently.  For example, if you have a family of four, you will decide whether or not each person signs up for COBRA independently.  You could decide to sign up one parent and then put everyone else on a private plan.  Essentially each person can make their own election decision.

Why would someone use independent election rights for their COBRA insurance?  The main reason that people use their independent election rights is to save money.  How?  Well when someone has a preexisting condition or major medical needs, they often learn that COBRA insurance is the best option for them so that they can continue the exact same care and because they may be denied from other plans.  However for their family members without the same needs, COBRA is expensive and unnecessary.  Normally they can sign up for a private plan and save up to 65% on the cost.  Or perhaps the children qualify for a governmental plan so the parents only sign up for COBRA.  No matter the situation many people find that when they choose to only sign up those who most need it for COBRA and find alternative plans for everyone else, they save money.

Can I Use COBRA Insurance If I Am Fired?

Posted on: September 5th, 2012 by Kristen Marie

Dear COBRA Insurance Direct,

I have been working at a company in Nevada for the last ten years.  The company has about 100 employees.  Unfortunately over the last six months or so I have had some personal problems and I was fired because I was consistently late to my shift.  I have had health insurance with them the whole time I have been employed and my wife and children also use the insurance.  Can I sign up for COBRA insurance if I was fired?

Thanks –

Fired and Confused

Dear Fired and Confused -

The good news is that you most likely can sign up for COBRA.  COBRA is for people who lost their jobs voluntarily and involuntarily.  Involuntarily loss of job can include both being laid off or fired as long as there was no gross misconduct.  In most situations being late is not enough to be considered gross misconduct so you should be able to sign up.  If your employer is telling you that you are not eligible due to being fired you can call the Department of Labor in Nevada to argue your case.  You can also contact the health insurance company and they may be able to help.

Additionally depending on your situation, I would recommend also exploring alternative plans because you may find you can save money by using a private plan.

Good luck!

Will COBRA Insurance Work If I Move?

Posted on: August 21st, 2012 by Kristen Marie

stethoscopeLosing a job normally brings about lots of changes to someone’s lifestyle, and more often than not this may involve moving. Sometimes it is a local move, but many times people end up moving long distances to save money, find work, or be closer to family during a hard time. However for people using COBRA insurance, or considering COBRA, relocation may affect your benefits. Therefore it is important to find out what consequences relocation will have on your COBRA coverage before packing up.

The main factor that will determine whether or not you can use COBRA if you move is your health insurance provider and policy. Some insurance plans only cover people living in a certain region or state, while others offer national coverage. Normally if your plan is a regional or state plan, your insurance will be cancelled if you move out of that coverage area. For national plans, COBRA usually extends to any state you move to. Normally international moves are never covered though COBRA insurance.

Additionally, make sure not to make any assumptions about your plan without consulting your health insurance provider and asking them specifically about your relocation plans and COBRA coverage. Many people make assumption that because their plan is provided by a national company, like Blue Cross, that automatically means that their coverage will work nationally. However most plans sponsored by national companies are regional or state based and in fact will not work if you move.

Medical Insurance for Pre Medicare Spouses and Dependents

Posted on: August 20th, 2012 by Kristen Marie

nurse with clipboardRonald has just turned 65 and is planning to retire in the next month.  He will qualify for Medicare and is planning on enrolling.  However, Ronald’s wife is only 60 and has been using Ronald’s employer sponsored health insurance plan.  Additionally, Ronald’s 24 year old daughter, who is in graduate school, is also using the employer plan from Ronald’s work. What options does Ronald’s wife and daughter have to stay insured?

Unfortunately this situation is all too common since Medicare is only available to people over 65 unless there is a disability.  So what options do you have for health insurance? 

1.  COBRA Insurance:  The most common option that people in this situation will use is COBRA health insurance.  COBRA will allow both Ronald’s wife and daughter to stay on his former employer sponsored health insurance plan for up to 36 months since Medicare qualification is a qualifying event.  Additionally to qualify for COBRA the plan must cover at least twenty full time employees and still be active.  Under COBRA coverage the health insurance plan will remain exactly the same – same doctors, deductibles, co-payments, etc. which is a huge benefit for many.  However the main drawback is that COBRA can be very expensive since they will be responsible for paying the entire premium.

2.  Employer Retiree Benefits:  Some companies offer retiree benefits to their employees after retirement.  Many times one of these benefits is that spouses and children can extend their coverage for a predetermined length of time.  The cost and term length vary by employer so to find out if this is an option for you, you will have to inquire with your workplace.

3.  Keep Working:  Although not the favorite option, sometimes if possible it actually may be beneficial for Ronald to keep working to maintain health insurance.  This is usually only in cases where there are serious health conditions and finding insurance through another provider or COBRA isn’t going to work out.  In some cases where keeping insurance is absolutely necessary, continuing to work may be the best option.  For people in this situation, you may be able to cut back your hours and still qualify depending on your workplace.

4.  Buy a Private Policy:  The last option, and one of the most common, is to buy a private policy.  Private policies can offer all levels of coverage from comprehensive and minimal and usually are much more affordable than COBRA for people who are relatively healthy.  For people with preexisting conditions or major medical needs, they can consider PCIP plans and state high risk pools.

In any case, it is extremely important that Ronald and his family find some way to keep health insurance coverage.  Having any lapse in coverage can make it more difficult to qualify for new plans in the future and also can have dire consequences should a medical need arise.  Carefully weigh your options if you find yourself in this situation to make sure that you choose an option that works in both the short term and long term for your financial situation and health situation.

Things to Ask When Shopping For Insurance

Posted on: August 13th, 2012 by Kristen Marie

looking at an insurance policyShopping for an insurance policy can be intimidating and it can be hard to understand the difference between plans as well as what would be best for you and/or your family.  Whenever you are shopping for a plan, make sure to always consider multiple plans and also to ask the important questions up front so you fully understand the plan.  Here are some questions you should always ask when you are considering a health insurance plan and/or comparing a health plan to COBRA insurance.

1.  How much is the monthly premium for the plan?  Can it change?  How much?  Asking this question up front is a good idea because cost is normally something everyone is thinking about.  However it is important not only to ask about the premium cost, but also to ask about if the premium amount can change and if there is a limit on how much it can increase.  Some health insurance companies are known to hook people with low premiums and then significantly up the costs after 3 or 6 months.

2.  Are you a state approved health insurance provider?  In order to provide insurance to you, the company must be authorized in your state to sell and provide insurance.  Always ask what states the insurance company is authorized in.  Also if you move or travel frequently, make sure to ask if the plan works when traveling or if you move to another state.

3.  How long is the policy length? What costs are there to cancel early? It is very important to know how long the policy you are purchasing lasts.  Some policies are very short term while others lock you in for a much longer period.  Since it is difficult to predict when you will get a job with health insurance again, it is a good idea to choose a plan that is flexible.

4.  How much are the co-payments and deductibles?  Co-payments and deductibles can end up adding large expenses to your health insurance plan.  A deductible is the amount you have to spend before the insurance will start to pay.  A co-payment is how much you have to pay whenever you go to the doctor, fill a prescription, or visit the emergency room for example.  Find out the the costs of these are and then estimate how often you go to the doctor to get a rough idea of how much you may spend annually on these things.

5.  How much does it cost for out of network care?  In the event you ever need care outside of your network, it is important to know those costs ahead of time.  Visiting a specialist many times may fall out of the network and you need to know what the cost will be if this occurs.

6.  Is there a coinsurance plan?  What is the maximum amount?  Coinsurance plans are very common but can also be very expensive if you have major medical expenses.  With coinsurance you are responsible for paying a percentage of the insurance costs, up to a maximum amount in most cases.

7.  Is there an annual limit?  Ideally you want a health insurance plan without an annual limit.  Although no one thinks they will ever reach their annual limit, of say $1 million, you can quickly reach that if you have a serious illness or major medical need.

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