Washington (SmartAboutHealth) - Families USA released a new report which has revealed that for many unemployed Americans, COBRA health insurance is simply too expensive.
Families USA, the non-profit group, put out the report this week, focusing on COBRA, the Consolidated Omnibus Budget Reconciliation Act of 1985.
The goal behind COBRA was to make health insurance affordable for unemployed Americans.
Families USA has found though that this is not the case, as they compared the average monthly premium for family health insurance under COBRA to how much compensation an average unemployed American received.
They found that the average compensation is around $1,300 for an unemployed American, while the average monthly premiums for family health insurance coverage under COBRA is $1,000.
This leaves next to nothing for families to live off of, making COBRA simply too expensive.
Overall, only 25% of those who are actually eligible for COBRA sign up for it, mainly due to the high cost.
With 47 million Americans living without health insurance, this is not a positive sign.
January 11th, 2009 at 5:32 pm
Don’t worry the Kennedys have tax payer provided health insurance.
I can’t afford health care but Kennedy made sure I pay for his or go to jail.
The Congress forces me to pay for their health insurance but I can’t have any.
While the people suffer the guberment gets big fat pensions and health insurance for life.
January 11th, 2009 at 5:39 pm
Could you use the word “simply” a few more times? There’s nothing “simple” about it, in any case. The government is so involved in health care, that there’s no competition — and when people aren’t paying, they don’t care what something costs. Then they are out of work, and discover the market is far out of what they’re willing or able to pay. What’s the solution, more government? Or is it restoring market forces so that health care costs cannot balloon, and doctors cannot charge whatever they want confident that a patient never sees a bill? As for the 47 million Americans, that’s clearly an inflated figure made in hopes of getting some more funding for your group and cause. A lot of those are counted if they’re young people who choose not to be insured. Until we’re honest that health care is not “simply” a right that should be immune from concerns of cost and stop listehing to special interest groups who exaggerate the challenge, we’re “simply” not going to improve the situation.
January 11th, 2009 at 5:40 pm
I retired early in 2001, took COBRA @ $900/mo.
By the time could take retirement in 2005, COBRA increased to $1000/mo but retirement was only $900/mo with NO annual COLA, and now COBRA is up to
$1175/mo…waiting till age 65 this next year, squeeking by on Social Security till then, so I understand entirely!!!
And I retired after 31 years in medical field, from a hospital that has THE WORST retirement of all the hospitals in our state!! :0
January 11th, 2009 at 6:02 pm
Duh… We need a study to tell us this? Wonder how much that study cost? I could have told them those statistics for FREE. I have never once considered COBRA a realistic benefit and I’ve been eligible for it on a couple occasions. Makes me want to laugh at the premiums I’ve been quoted in the past, if it wasn’t so sad and pathetic…
January 11th, 2009 at 6:21 pm
COBRA has always been way too expensive for any but the very well to do. In my own experience I have never used it, the price being out of reach. Thank God I live in a state that provides health care to the unemployed.
January 11th, 2009 at 6:32 pm
cobra was offered upon leaving toyota for me last year but….
At a staggering 617.00 a month!!
now I see why many would rather die at home when terminally ill,rather then rely
on family and loved ones. Thx to the movie SICKO by Michael Moore>>>
MY UNDERSTANDING OF WHY THINGS ARE LIKE THEY ARE MAKE ALL THE SENSE>isnt greed <terrible
January 11th, 2009 at 6:34 pm
Thank you! Finally someone is shedding some light on this outrageous COBRA, which is mainly for overpaid execs whop can afford to pay $1,000 a month whilel looking for a job!
January 11th, 2009 at 6:43 pm
Really?! Where have you been? COBRA has been a joke for decades… When your working your health insurance is something like a couple hundred, they lay you off and say you get COBRA to protect you and it’s 4 times the cost of what you paid when you had a job!!! This entire system is a joke, they should simply eliminate it and tell the regular Joe he’s just screwed until he can get another job!
January 11th, 2009 at 6:46 pm
Families USA just figured out that COBRA is expensive recently????? That unemployed families can’t afford to pay 80-100% of unemployment compensation to pay for it???????
Again, other organization asleep at the wheel. Did they actually pay someone for this “study”
COBRA has NEVER had anything to do with making healthcare affordable. COBRA has never been afordable!
It was to make healthcare insurance available when being laid off or changing jobs. It was offered because one’s next insurance company was going to say “Sorry, you have had this condition but you weren’t insured, sorry that is pre-existing so we won’t cover it.” THAT is what COBRA was about..
We need to have healthcare for everyone so that no family has to go bankrupt because someone becomes ill. Wake up America.
January 11th, 2009 at 6:46 pm
Remember, the employer was paying exactly the same amount when he was paying for the health insurance for the employee. I find it interesting, that when the ex employee now has to pay for it, it becomes too expensive.
January 11th, 2009 at 6:54 pm
Cobra has always been to high and a joke. Glad to see that they are on top of it!
Apparently it takes the unemployment rate going through the roof to get someones attention.
January 11th, 2009 at 7:00 pm
I can’t believe that this is big news to our government. It looks to me that the government is very out of touch with the unemployed Americans. But that’s not big news either!!
January 11th, 2009 at 7:07 pm
WOW it has only taken 24 years and the economy getting bad enough to effect the upper middle class for anyone to notice this issue. this is but one more example of the sociological “Law of Peter.” It proposes that in a one rises to the level of their incompentency then remains there!
It is refreshing to see any orgnaization to take up this issue and gain media attention. If one has a family member who has a serious preexisting condition, then they cannot affort to NOT scrape together the money to keep group coverage in effect. Otherwise, after 63 days of no coverage, other insurance companies will refuse coverage. Not a good situation!
When you lable something “Medical” the cost rises 200 to 300%. Turn something over to the government that elevation turns in to astronomical increases. This program hurts the exact population it would have us believe it is helping.
Middle Class American need to speak up and vote. All ballots should have “None of the Above” as an option! We are tired of picking the “Lesser of Evils” offered to represent us.
January 11th, 2009 at 7:11 pm
How long did it take them to come to this conclusion? I knew this was the case when I lost my job years ago. If the US wants to help the economy and business compete globally the single most beneficial action would be to initiate single payer healthcare. Just about every developed country has it that competes with us and that gives their industry a distinct advantage.
January 11th, 2009 at 7:24 pm
Too many unemployed are going to wind up without health insurance because COBRA costs are high. It’s the nature of the beast, health benefits are taken for granted while you’re employed until you’re unemployed.
I fear if the government doesn’t provide individuals with some type of supplement or pay for 6 months coverage that the number of personal bankruptcies will increase. No insurance and a basic hospital visit can run $30K. And as an individual without insurance you pay “retail” not the negotiated rate a health insurance company pays.
Some states at least have programs to get kids insured if your income falls under the cap so that should at least help with keeping kids healthy. As one who never had to accept outside financial or social services help it became part of reality when I was laid off from a company after 16 years.
Put your pride aside and make use of what the government makes available to you and others.
I’d love to see some type of government assistance to pay COBRA for 3, 6, 9 months, whatever, to help people stay healthy. Or, cynically, do we have to be part of the financial industry for health help and get more government bailouts?
Sad state of affairs for the United States, we’ll recover, and we should look to help others in need of assistance if we’re fortunate to still be employed.
January 11th, 2009 at 8:12 pm
It’s amazing what passes for “breaking news,” I could have told you that this dog-and-pony show of an insurance scam is way too expensive ten years ago. But this is how it works in this country, no matter how bad something really is, all that needs to happen is for the spin maestros to tell the public that it’s great, and the public will sop it up like Goofy at a gravy eating contest. COBRA is not affordable, doesn’t help the displaced worker, is a colossal waste of taxpayer time & money, is an insult to the intelligence of those of us who aren’t too lazy-minded to fall for the spin [lies], & should be as illegal as any white collar money scam… oh yeah, I forgot, it’s already as illegal as a white collar money scam!
January 11th, 2009 at 8:18 pm
this is NEWS??? COBRA has always been a joke! One’s unemployed, the stupid healthcare costs more than unemployment pays - c’mon, get real, kids! I never heard of anybody who actually took advantage of this super government program. What a joke, Washington’s idea of helping us peons!
January 11th, 2009 at 8:20 pm
OMG! They had to do a STUDY to figure this out?? I knew this 8 years ago when I was laid off. They wanted more for COBRA (for just my son and me) than I paid for my monthly house payment! Needless to say, COBRA wasn’t in the budget and we did without. Geez. They didn’t need to do a study. All they had to do was ask the first 1000 unemployed people they met. I never would have guessed “The goal behind COBRA was to make health insurance affordable for unemployed Americans.” What a CROCK.
Why on Earth did it take 23 years for someone to notice “that the average compensation is around $1,300 for an unemployed American, while the average monthly premiums for family health insurance coverage under COBRA is $1,000″?
January 11th, 2009 at 8:31 pm
Let’s see if I understand this. We have a Government established program that is suppose to provide health insurance for those who have been unemployed and it is totally inadequate. But the people that established this program want to establish a “universal health care program” to provide health insurance for the whole population. Tell me please, how can anyone believe that the result will be any different?
January 11th, 2009 at 8:33 pm
There is no surprise here. COBRA was the rather pitiful result of the grand intention to radically expand health care access in the Clinton administration. Clinton and Congress acted as if it was a great victory, when in reality it just finalized his retreat from this issue.
This should be a cautionary tale for those of us–a majority of Americans–who are convinced that the current system of employer-provided health insurance has failed.
Unless we insist on governmentally-guaranteed universal health care, nothing may happen.
January 11th, 2009 at 8:42 pm
I’m paying 1200 a month now. It would be more cost effective for me to die.
January 11th, 2009 at 9:05 pm
They just figured this out NOW??? Cobra has always been to costly, especially when you just lost your job or were in between jobs. Please!!!
January 11th, 2009 at 9:07 pm
This is just more proof that we as a nation are in deep trouble when it comes to providing medical coverage to those people who are not able to afford coverage. The price for medical coverage is insane for the average working person that does not receive coverage from their employer and it is nearly impossible for someone collecting unemployment benefits to afford any type of medical coverage.
January 11th, 2009 at 9:08 pm
Why does it take a depression to wake you up to the fact that cobra is too expensive as it has always been???
January 11th, 2009 at 9:16 pm
This seems like another one of those “DUH!” moments. COBRA has ALWAYS been too expensive. It’s just another example of health care costs run amok.
January 11th, 2009 at 9:25 pm
Gee, someone is JUST NOW figuring this out? COBRA is a joke. This is just a law somebody got put on the books to make themselves feel as if they had done something special.
January 11th, 2009 at 9:37 pm
COBRA is a joke. They only offer it to be “fair” and “offer “benefits to unemployed people. “I bet the 25% of people who can afford it are the Executives and CEO’s. Thanks for achieving your goal COBRA…
January 11th, 2009 at 9:48 pm
I completely agree with it. Especially in case of not having a job how can one be expected to pay high cost of insurance. I would rather save my money than spend it over the Cobra when i dont have my job. That’s what i did last time and would perhaps do the same again.
January 11th, 2009 at 9:52 pm
I think you are twisting your facts. I disagree that the average monthly “compensation is around $1300″. That equates to only $15,600.00 a year which is probably very close to the poverty line. I live in California, where everything is expensive!
While COBRA isn’t cheap, for someone my age (61), the alternative HMO/PPO cost is approximately 3 times the cost of COBRA, per month. I know, I’ve checked. Now that is too expensive for just about anyone. But this country’s health care system is completely broken and that’s the REAL problem. Self-employed people should be able to buy group health insurance just like companies, but that’s not the way it works.
January 11th, 2009 at 10:06 pm
It is very good to see this report, but it is nothing new. COBRA has been beyond the financial reached for an unemployed person for quite some time. I can only hope that the “new” administration coming on board in January will see this and act. We can only hope.
January 11th, 2009 at 10:25 pm
Dhaaaa….
COBRA’s been out since 1985 and they’ve finally figured this out?
January 11th, 2009 at 10:33 pm
Even worse, now it’s practically illegal to be alive without health insurance even if you take care of your body and focus on prevention. This is getting to the point of outright slavery with all these bills and taxes and fees piling up. At the very least people who be allowed to opt-out of this forced financial ruin as they should with the Social InSecurity program.
January 11th, 2009 at 10:38 pm
well i hope all the people who are having a hard time putting food on the
table check out your entertainment section , i have to say that this hollywood golden globe crap is an insult to the average american person . remember this before you go out and buy another movie or music cd i don’t think they give a rats ass about you
January 11th, 2009 at 10:41 pm
Where have you been since 1985? The ONLY reason a person pays the outrageous COBRA rates is that it is the only way a person can insure uninterrupted health care coverage. If a person loses a job, has family member with recent or ongoing health problems, even though they qualify for insurance with the new employer, depending on the circumstances, a recent or ongoing health problem may not be covered for 1- 2 years. Comparing 1- 2 years of medical expenses for a non-covered condition may cost more than the COBRA expenses incurred between jobs.
January 11th, 2009 at 10:42 pm
DUH! This is suppose to be some kind of revelation? And this report is just now “revealing” this? Where have these people been hiding? With their heads buried in the sand?? It has always been like this but just ignored. With the economy now and the “focus” on the unemployed things like this are now finally getting some attention.
January 11th, 2009 at 10:45 pm
My previous company had its insurance through Aetna. I found that it was cheaper for me to go straight to them and get insurance then it was to do the Cobra plan that my employer offered.
January 11th, 2009 at 11:03 pm
Another of those wonderful government programs that is funded by us, provides many, many jobs to those we hired to help us out. And is totally worthless. 25% is lousy justification for continuing to provide this service.
January 11th, 2009 at 11:15 pm
While it is true that Cobra is very expensive, it is the only option available that gives access to a wide range of health products. Let’s face it, health care in America is very expensive…even for families with healthcare insurance and jobs. Until the costs of health care are artificially controlled by the government, cobra will remain a very expensive alternative to having no insurance at all.
January 11th, 2009 at 11:34 pm
COBRA was not designed to make insurance more affordable. It was designed to allow folks to access benefits upon losing coverage under some few circumstances. It was just a public relations move on the part of our government. It allowed employers to recoup the administrative costs by charging the participants. It sounded great on the surface but in reality served only to give bragging rights to our leaders. It has always been unfafforadable for the participants and has always been a last ditch effort for the participants and a course of last resort. It was a poor compromise between the insurance companies and our government leaders at devastating costs to participants. Virtually no one can afford the costs. It has done more than anything else to take funds away from retirement Plans.
January 11th, 2009 at 11:45 pm
In response to “For Unemployed Americans, COBRA Simply Costs Too Much”
As Eddie Murphy once said, “Tell us something we don’t know, (bleep)!”
January 12th, 2009 at 12:06 am
And they have just now figured this out, eh??? Sheesh! No wonder this country is in such a rut.
I knew COBRA was too expensive the moment I got laid off and looked at the rate I’d have to pay to continue coverage on a family.
Let’s Do The Math
Unemployment:
$343.00 per week - that equals $1,372.00 GROSS.
Cobra Payment: -
$864.00 per month
Monthly Income $1,372 minus $224.00 in taxes leaves, um… $1,148.00
$1,148.00-864.00= $284.00
My question is, what moron came up with the “affordable” COBRA plan in the first place? Is he or she insured? I sure hope so, because he or she needs a Psychiatric Evaluation STAT!!!