COBRA health insurance assistance running out for laid-off workers

by Vicky Eckenrode

With the federal subsidy to help families pay for COBRA health insurance beginning to run out yesterday, many more North Carolinians likely will fall into the uninsured ranks, a consumer group reported Tuesday.

Families USA, a group that supports health care reform legislation, estimated families in North Carolina have paid an average of $389 a month for COBRA with the subsidy. Without the assistance, those families can expect to pay $723 more out of their pockets for an average monthly premium of $1,112 to keep coverage through the insurance program, which helps workers keep benefits after losing their jobs.

Read the full report here.

The federal subsidy started earlier this year as part of the federal stimulus package as a way to help people continue insurance coverage as unemployment began to rise.

The first batch of subsidies, paying 65 percent of the premium costs, expired Nov. 30. For anyone who began receiving subsidies after March, the money runs out nine months after they signed up. People who lose their jobs now also won’t be able to get the money.

“For millions of laid-off workers and their families, the federal COBRA subsidies have been a health-coverage lifeline,” said Ron Pollack, executive director of Families USA. “It is essential, therefore, that new jobs legislation extends those subsidies.”

Without help from the subsidy, a person’s COBRA bill eats up nearly 84 percent of the average monthly unemployment benefit in North Carolina, the report stated.

Legislation has been introduced in Congress to extend the benefit longer, though funding will be an issue as lawmakers continue to debate the price tag for the broader health care reform measures.