What to Do When the COBRA Subsidy Runs Out

Back in February 2009 the President signed The American Recovery and Reinvestment Act. This stimulus bill provides the unemployed a 65% subsidy for 15 months, this allowed many to keep their former employers health insurance under COBRA.   The employer plan is generally more comprehensive than an individual plan, plus with the subsidy it is also cheaper.

The Subsidy is available for 15 months, which means if you were laid off in March of 2009, your subsidy time is almost up.  You will now need to pay the full premium. Employer plans are group plans and in general group plans are more expensive than individual plans.  If you and your family are healthy than you should be to get a less expensive but equal or better plan than from what you already have.  As tempting as it may be, don’t shop on price alone. Cheaper does not always mean better. Make sure you know what you’re getting.

If your family has any preexisting conditions it may be difficult to get individual health insurance.  You would probably be rated up and have a higher premium, but thanks to HIPAA you should be able to purchase the policy without any exclusions.

You can research plans by going to a website like USA Health Insurance Center or seek out the advice of a professional insurance broker. 

Make sure not to delay and that you do not have a gap in coverage of more than 63 days or the guaranteed insurability of HIPPA expires and even if you are healthy, you might need to go through a medical exam to prove it.