COBRA Health Insurance?

[imightbechad]

OK.

I'm a 25 y/o male currently enrolled in an advertising portfolio school while I look for a job.

I'm about to reach the end of possible coverage under my parents' insurer (Aetna) thanks to grad school extensions, etc.

I called Aetna to ask about my options, and they said that I should enroll in a "COBRA Continuance Coverage Plan." As far as I can tell, this means I'll continue to have the same coverage I enjoy now just with a (much) larger COBRA co-pay.

My question is: should I shop around or just take what they're offering?

Personally, I think the coverage is "too good" for me, meaning I'm a healthy young guy with no prior health complications. However, I plan to have some minor orthopedic surgery done in the next few months, and I want to make sure I don't get fucked when that comes up.

Anyone else under a COBRA plan? Thoughts? Advice?

Chad

 

[kwilkinson]

When I was the benefits coordinator for a small company of just a few thousand employees, I had mixed feelings about COBRA. On one hand, it was a good opportunity for terminated employees to continue their health coverage until they got a new job and became eligible for a new plan. I think that's how COBRA started--- to give people coverage long enough to find a new job, because it's only supposed to last for 12 months and can be extended to 18 months upon request, IIRC (which I might be incorrect about). On the other hand, it was hella expensive, IMO. I would imagine you should be able to find cheaper by shopping around. Your surgery definitely makes your situation different, but as someone in the same situation as you (young, relatively healthy, going off my parent's plan in 6 months) I plan on shopping around a bit for the best deal, and will assume that I don't need really incredible coverage, as I've only been to the doctor 3 times in the last 3 years.

BTW--- under COBRA, the co-pays should all be the same. All the coverage should be the same, too. It's just the premium that goes up a lot.

 

[philosophe]

If you've been following the news lately, you should know that buying insurance as an individual has many pitfalls. Just google "rescission" or look at http://articles.latimes.com/2009/jun...s/fi-rescind17

IMHO, your best bet is to stay part of a group policy while you find a position with benefits. You are young and healthy now, but you do not know what will happen tomorrow.

 

[dopey]

An interesting aside is that insurers hate COBRA. Apparently, COBRA insureds cost the insurers a lot more money than regular insureds as they tend to be people who require significantly more medical care than average - not surprising, since it is a self selecting group that elects to continue to pay extra to hang on to medical coverage.

 

[kwilkinson]

Originally Posted by philosophe

If you've been following the news lately, you should know that buying insurance as an individual has many pitfalls. Just google "rescission" or look at http://articles.latimes.com/2009/jun...s/fi-rescind17

IMHO, your best bet is to stay part of a group policy while you find a position with benefits. You are young and healthy now, but you do not know what will happen tomorrow.

Originally Posted by dopey

An interesting aside is that insurers hate COBRA. Apparently, COBRA insureds cost the insurers a lot more money than regular insureds as they tend to be people who require significantly more medical care than average - not surprising, since it is a self selecting group that elects to continue to pay extra to hang on to medical coverage.

Do either of you know much about COBRA? It doesn't even make sense to me that he would be eligible for COBRA as an individual when he's just a dependent listed under someone else's name.

 

[dopey]

Originally Posted by kwilkinson

Do either of you know much about COBRA? It doesn't even make sense to me that he would be eligible for COBRA as an individual when he's just a dependent listed under someone else's name.

I don't know much about it, and my experience with it has been limited to coverage for terminated employees. But I couldn't say it is never available in other circumstances.

 

[Douglas]

Originally Posted by kwilkinson

BTW--- under COBRA, the co-pays should all be the same. All the coverage should be the same, too. It's just the premium that goes up a lot.

Well, sort of.

It's not that the premiums go up... it's just that the company is no longer picking up part of the tab. I think there's a small admin fee of some sort, but essentially it's just you paying the full bill.

 

[Douglas]

Originally Posted by kwilkinson

Do either of you know much about COBRA? It doesn't even make sense to me that he would be eligible for COBRA as an individual when he's just a dependent listed under someone else's name.

He WAS a dependent but now that he's reached the age limit his parent's company no longer insure him as a dependent, so he can collect COBRA like anyone else.

 

[kwilkinson]

Originally Posted by Douglas

Well, sort of.

It's not that the premiums go up... it's just that the company is no longer picking up part of the tab. I think there's a small admin fee of some sort, but essentially it's just you paying the full bill.
Right. No employer contributions.

Originally Posted by Douglas

He WAS a dependent but now that he's reached the age limit his parent's company no longer insure him as a dependent, so he can collect COBRA like anyone else.

I thought only the actual policy holder or the employee was eligible for COBRA, and obviously if he were to sign up for it, any of his dependents would be covered, but since Chad wasn't a dependent anymore, he wasn't eligible. But it's been a long ass time since I've done any of it, and I've drank a lot since then, so my memory may be fuzzy. Just sounded strange.

 

[Douglas]

Wikipedia:

Among the "qualifying events" listed in the statute are loss of benefits coverage due to (1) the death of the covered employee; (2) an employee loses eligibility for coverage due to involuntary termination or a reduction in hours as a result of resignation, discharge (except for "gross misconduct"), layoff, strike or lockout, medical leave, or slowdown in business operations; (3) divorce or legal separation that terminates the ex-spouse's eligibility for benefits; or (4) a dependent child reaching the age at which he or she is no longer covered. COBRA imposes different notice requirements on participants and beneficiaries, depending on the particular qualifying event that triggers COBRA rights.

 

[MsMcGillicuddy]

I've spent the last few months doing some research on this stuff. COBRA premiums can be huge - often $300 and more for a single adult. Other posters are right - the other aspects of the coverage stay the same; it's just the monthly premium that skyrockets.

Below is based off of discussions I've had over the past month with an insurance broker.

I'd suggest shopping around before committing to COBRA (you should have 60 days from the cut-off of your coverage under your parents' plan to make the decision to accept it) and seeing if you can get coverage at all. If you have an existing condition that requires surgery, you'll have to disclose that (lying is not a good idea - if they find out, you are screwed), which means you could be denied coverage. If you get insurance through a job, pre-existing conditions don't matter.

If you go more than 63 days without health insurance, then any attempt to apply for insurance on your own (again, independently and not as part of a job where you're guaranteed insurance) means that they can accept you but can exclude anything related to your orthopedic condition. For example - you go off your folks' coverage and can't find a job or an insurance plan to accept you. And you decide that, hey, you could get hit by a car tomorrow, and you don't really want to saddle your family with your medical bills. You can re-apply for insurance, and they might accept you, but at that point they can say they won't pay for anything related to your pre-existing condition (in your case, orthopedics).

If I were you, I'd apply for insurance and if denied take COBRA. Going without, as appealing as it may be in terms of saving money, is really not a good idea. You never know what could happen.

One other option - a friend of mine was unemployed after grad school and aged out of her parents' insurance and was able to get okay coverage through a state program. That was in New York - you might want to look into it in your state, as you may qualify.

 

[kwilkinson]

Damn. I feel bad for the people who called my stupid ass looking for answers. (JK of course)

 

[lbcgav]

Originally Posted by Douglas

He WAS a dependent but now that he's reached the age limit his parent's company no longer insure him as a dependent, so he can collect COBRA like anyone else.

^^^This is correct for the following reason:

-Qualifying Events for Dependent Children:
-Loss of dependent child status under the plan rules
-Voluntary or involuntary termination of the covered employee's employment for any reason other than gross misconduct
-Reduction in the hours worked by the covered employee
-Covered employee's becoming entitled to Medicare
-Divorce or legal separation of the covered employee
-Death of the covered employee

The highlighted instance is the applicable qualifying event.

In my opinion, you're better off finding a high deductible individual plan, unless you have a pre-existing condition. You're going to pay way more for COBRA than you would for and individual plan assuming you're relatively healthy. The health insurance company is allowed to by law (and therefore usually do) charge up to 10% more for COBRA than their published rates.

EDIT: Answered in better detail above^^^

 

[sho'nuff]

300+ dollars per individual a month would be worth it if you have a personal doctor at your call, but if it is HMO or kaiser? no way

 

[Douglas]

Originally Posted by MsMcGillicuddy

I've spent the last few months doing some research on this stuff. COBRA premiums can be huge - often $300 and more for a single adult. Other posters are right - the other aspects of the coverage stay the same; it's just the monthly fee that skyrockets.

We wonder why we have cost issues with health care in this country.

Nobody realizes what it costs to go to the doctor, to have surgery, to actually use this stuff. It's not that COBRA premiums are huge - that's just what it costs, and nobody realizes it because someone else is paying for it.