There may be a cheaper COBRA alternative. I found this on hillphysicians.com/COBRA. Also, check into HealthyFamilies for your kids.
COBRA
COBRA premium reductions are available for many.
Eligibility Criteria | I Didn't Get Cobra | How it Works | What is COBRA? | Printer Friendly Version |
Many people have lost their jobs in this difficult economy. If you’re one of them, you may be eligible for a new program that provides reduced premiums for continued healthcare coverage.
The federal stimulus package, “The American Recovery and Reinvestment Act of 2009 (ARRA),” provides for a 65% reduction in COBRA premiums for certain assistance eligible individuals for up to 9 months. This program was signed into law on February 17, 2009 with the first covered month being March.
This means that your COBRA coverage may now be much more affordable, allowing you to keep your health insurance and physician relationships intact.
This is available for people who meet the following Eligibility Criteria:
Must be eligible for COBRA due to an involuntary job loss between September 1, 2008 and December 31, 2009.
Have no other coverage available through another group health plan or Medicare.
Have modified gross income less than $145,000 (single) / $290,000 (filing jointly).
Who Is Not Eligible?
If you can obtain insurance from another group plan, such as a spouse’s insurance or from Medicare, you will not be eligible for this program.
There also are income restrictions that impact the amount of any reduction. For taxpayers with adjusted gross income between $125,000 and $145,000 (or $250,000 and $290,000 for joint filers), the amount of the premium reduction that must be repaid is reduced proportionately.
If an individual’s modified adjusted gross income for the 2009 tax year exceeds $145,000 (or $290,000 for joint filers), then the amount of any premium reduction during the tax year must be repaid.
Individuals may permanently waive the right to premium reduction but may not later obtain the premium reduction if their adjusted gross incomes end up below the limits. If you think that your income may exceed the amounts above, consult your tax preparer or view the IRS information related to the stimulus plan here.
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What If I Did Not Sign Up for COBRA?
If you were eligible and didn't elect COBRA, you may have an additional opportunity to elect it now and take advantage of the premium reduction.
Individuals involuntarily terminated from September 1, 2008 through February 16, 2009 who did not elect COBRA when it was first offered or who did elect COBRA, but are no longer enrolled (for example because they were unable to continue paying the premium) have a new election opportunity.
This election period begins on February 17, 2009 and ends 60 days after the health plan provides the required notice.
This special election period does not extend the period of COBRA continuation coverage beyond the original maximum period (generally 18 months from the employee's involuntary termination). This special election period opportunity does not apply to coverage sponsored by employers with less than 20 employees that is subject to State law.
How the New Program Works for COBRA Beneficiaries
When you were first hired you should have received an informational packet identifying your employer’s COBRA plan administrator. That administrator will send you a notice about COBRA eligibility and the new program. This notice must go to all individuals, whether they have COBRA coverage or not, who had a qualifying event from September 1, 2008 through December 31, 2009. Individuals eligible for the special COBRA election period also must receive a notice informing them of this opportunity. This notice must be provided by April 18, 2009. You also may wish to proactively contact your plan administrator.
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Can I Switch Health Plans?
You may switch plans during the annual open enrollment period offered to active employees. If your former employer allows it, you also may be able to switch to a lower cost plan now; however, the plan can not be just for dental, vision, a health flexible spending account or treatment that is furnished in an on-site facility maintained by the employer.
What If I Run Into Problems?
Individuals who request treatment as an assistance eligible individual and are denied by their plan, employer or insurer can request an expedited appeal to the U.S. Department of Labor's Employee Benefits Security Administration. The Department must make a determination within 15 business days of receipt of a completed request for review. The Department is currently developing a process and an official appeal form and will post new information as it becomes available. View the Department of Labor's ARRA site here. You can also contact a Benefits Advisor by calling toll free 1-866-444-3272 for more information.
How it Works for Employers.
Eligible individuals pay only 35 percent of their COBRA premiums and the remaining 65 percent is reimbursed to the coverage provider through a tax credit against certain employment taxes. If the credit amount is greater than the taxes due, the Secretary of the Treasury will directly reimburse the employer, insurer or plan for the excess.
The premium reduction applies to periods of coverage beginning on or after February 17, 2009. A period of coverage is a month or shorter period for which the plan charges a COBRA premium. The premium reduction starts on March 1, 2009 for plans that charge for COBRA coverage on a calendar month basis. The premium reduction for an individual ends upon eligibility for other group coverage (or Medicare), after 9 months of the reduction, or when the maximum period of COBRA coverage ends, whichever occurs first. Individuals paying reduced COBRA premiums must inform their plans if they become eligible for coverage under another group health plan or Medicare.
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What is COBRA?
COBRA gives workers who lose their jobs, and thus their health benefits, the right to purchase group health coverage provided by the plan under certain circumstances.
If the employer continues to offer a group health plan, the employee and his/her family can retain their group health coverage for up to 18 months by paying group rates. The COBRA premium will be higher than what the individual was paying while employed because the individual will pay up to 102% of what the employer pays, however, this coverage may be less that what is available for private, individual health insurance coverage.
The plan administrator must notify affected employees of their right to elect COBRA. Typically, the employee and his/her family each have 60 days to elect the COBRA coverage, otherwise they lose all rights to COBRA benefits. Exceptions may be made for individuals who fit the eligibility requirements of the stimulus program.
COBRA generally does not apply to plans sponsored by employers with less than 20 employees. Many States have similar requirements for small plans providing benefits through an insurance company. The premium reduction is available for plans covered by these State laws.
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The following links provide more information about this new program:
The American Recovery and Reinvestment Act of 2009 (ARRA)
see page 341 of this bill.
Department of Labor's COBRA web site.
Department of Labor's Employee Benefits Security Administration Home page
IRS' COBRA web site
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Hill Physicians' Info Sheet on COBRA Extension
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