COBRA Insurance is WHAT Exactly?

Should You Continue COBRA Insurance Coverage?

By Darryl James

When you leave one job, the next job may have a ninety-day waiting period before your new health insurance coverage begins. If you can not secure private insurance, you and your family may experience a gap in coverage.

Thanks to the Consolidated Omnibus Budget Reconciliation Act of 1985, also known as COBRA, you can choose to continue the insurance coverage from your former employer.

The COBRA law allows employees to extend their health care coverage up to 18 months after separating from the employer that provided the benefits. This continuation of coverage can be secured for yourself and your spouse, as well as your dependents.

While COBRA can help to avoid a gap in coverage, the plan can be expensive. In order to continue coverage, you must pay the full monthly insurance premium, as opposed to any discount your employer may have provided.

There are a few things to consider before choosing to continue health care coverage through COBRA.

First, of course, is cost. Shop around for private insurance and if this option is less expensive, COBRA may not be for you.

Second, consider any health issues you or your family may have. If there are pre-existing medical concerns, it may be both expensive and difficult to move to private health care insurance. Some pre-existing health conditions may either be excluded from coverage or may greatly increase the cost of the monthly premium.

And finally, determine whether your new employee will actually offer health care coverage. Also determine what level of coverage will be provided.

COBRA provides an option when filling the gap in health care coverage. As with any insurance coverage, it is easier to obtain when you already have coverage in force.

There are several of companies offering competitive rates for private health care insurance coverage. Weigh all of your options before filling the gap when separating from your employer.