Tuesday, December 1, 2009
Family health insurance to rise sharply without COBRA subsidy
Posted by Jorden Meltz
A new study estimates that the end of a hefty government subsidy could force millions of laid-off workers to pay more than 80 percent of their monthly unemployment checks to keep their job-based family health insurance coverage intact.
An estimated 7 million jobless workers and their dependents are thought to have received the temporary subsidy, which pays 65 percent of their health insurance premiums under a law known as COBRA, the Consolidated Omnibus Budget Reconciliation Act.
However, the nine-month subsidy expired Monday for those who first began receiving it in March through the American Recovery and Reinvestment Act.
Estimates vary, but COBRA subsidies pay an average of $722 per month toward the average national cost of family coverage, which runs about $1,111 per month, according to Families USA, a liberal consumer health advocacy group.
Without the subsidy, however, COBRA family coverage would eat up a whopping 83.4 percent of the $1,333 average monthly national unemployment insurance benefit, according to a Families USA report issued Tuesday.
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