Jean Chatzky
In just two weeks, the health insurance subsidy that was included in last year’s economic stimulus plan will start to expire.
The subsidy of a federal program known as Cobra allows workers to continue their employer’s health insurance after leaving their job. The subsidy, which covers 65% of a laid-off worker’s Cobra payments, was key in helping people keep their insurance during the recession. In fact, a new federal study found that about a third of eligible, unemployed workers took advantage of the help.
Those who became eligible between September 2008 and March 2009 will end their run May 31, said Carrie McLean, a consumer specialist at ehealthinsurance.com. Others will drop off soon after.
“After the subsidy ends, Cobra goes back to the full cost, which is quite expensive, especially given that by the time you get to that point you’ve likely been unemployed for a while. It would cost over $1,100 a month for someone to extend the average, employer-sponsored coverage through Cobra for a family, or $400 a month for an individual,” said Karyn Schwartz of the Kaiser Family Foundation. Read more…
