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The Laid Off IT Guy! Starting COBRA

Posted July 14, 2009

Topics: Information Technology

What is COBRA?

The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) requires most employers with group health plans to offer employees the opportunity to continue temporarily their group health care coverage under their employer's plan if their coverage otherwise would cease due to termination, layoff, or other change in employment status (referred to as "qualifying events").    I’m not an insurance man, so for a detailed look at COBRA, visit http://www.cobrainsurance.com/COBRA_FAQ.htm.

Here’s something great the Obama administration has done to help unemployed workers.  The recent provision approved through Congress reduces the cost of COBRA by approximately 75%.  So, instead of paying about $1000/mo for health/vision/dental insurance for my family, I’m able to pay only about $350/mo, which is in line with what I paid through payroll deduction previously.  That, I believe, is available for 9 months at the reduced rate.  You may maintain coverage under COBRA for up to 18 months.

I certainly considered not carrying health insurance during my lay off.  Even $350/mo is a lot to pay when you need to watch your expenses.  If you don’t know (like me), being on COBRA isn’t a new insurance plan, but rather a continuation of the same plan that you had through your previous employer.  I had good coverage and wanted to continue it to protect my family.

I’m glad that I did.  My son needed ear surgery to have tubes put in to help his hearing.  All of us needed to visit the dentist.  My wife and I have kept our annual physicals on schedule.  My son also got contacts.  Just today I got my annual eye exam.  All of those doctor visits would have been cost prohibitive (especially the surgery) without carrying insurance.

My advice to you job seekers is continuing your insurance.  You never know when you might need to cover something major.  The ear surgery was outpatient, but still cost over $4,000. 

I’d really like to hear from you about your job hunting experiences.  Please share your comments with me and our readers.

Thank you!

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