Any COBRA experts out there?
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Brat
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
The COBRA insurance is a known quantity, you know how it works and it may have generous benefits. However it is often more expensive (you are now fully paying for those generous benefits) than a policy you can purchase directly that has less generous benefits. If you buy the policy through the ACA premium support may be available as well.
Theseus
Recycles dryer sheets
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Timing could be important if you have already invested money into the deductibles or max OOP. If you are switch to any other insurance mid-year you could be tossing that money out the window and starting over. If, as might be assumed by this being December, you were to switch at the beginning of the year that makes no difference of course, unless you have employer provided benefits that might roll over into the new plan year. Other than that caveat, a decision based on head to head comparison based on price, deductibles, OOP, availability of in-plan providers, and the somewhat intangible aspects of finding an insurance company that isn't a PITA to deal with should about cover it. Lots of very good info in other threads/posts on this board cover that pretty well already.
One additional thing to note about COBRA, I found the "guarantee" of 18 months of coverage being available isn't necessarily ironclad. If for some reason, the COBRA offering employer ceases to offer a group plan to it's employees, it no longer has anything to offer for COBRA coverage either. Not a problem in most cases, but it might be something to be aware of.
One additional thing to note about COBRA, I found the "guarantee" of 18 months of coverage being available isn't necessarily ironclad. If for some reason, the COBRA offering employer ceases to offer a group plan to it's employees, it no longer has anything to offer for COBRA coverage either. Not a problem in most cases, but it might be something to be aware of.
steelyman
Moderator Emeritus
There was a period of time (a little over a year) between when I left work and actually retired. There was no ACA operational at that point.
I spoke to a benefits counselor who emphasized that to be eligible for retiree health insurance support, it was very important to show "continuous credible coverage".
I chose COBRA for that, even though it was godawful expensive. I'd learned about this several years in advance of leaving so I had time to set aside the funds to cover it. I probably could have gone a less expensive route, but didn't want to find any "gotchas".
I spoke to a benefits counselor who emphasized that to be eligible for retiree health insurance support, it was very important to show "continuous credible coverage".
I chose COBRA for that, even though it was godawful expensive. I'd learned about this several years in advance of leaving so I had time to set aside the funds to cover it. I probably could have gone a less expensive route, but didn't want to find any "gotchas".
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I did not qualify for any ACA tax breaks when I retired in June. I priced private policies and compared them to what I could get through COBRA. In my case - to get comparable coverage - I would have had to pay about $400/month more for my family. I suspect that's because my husband who's older than me was covered under a flat group rate - rather than by age - as he would be under private insurance. I continued COBRA - and switched to an plan purchased through the state exchange for Jan 2015 forward.
So - depending on your household makeup and how well your employer negotiated the group coverage - COBRA may give you more bang for the buck.
So - depending on your household makeup and how well your employer negotiated the group coverage - COBRA may give you more bang for the buck.
My COBRA plan was $614 a month. Something comparable would be a Platinum plan that is $574 a month. The subsidy makes the exchange plan better.
COBRA gives a 60 day grace period to free ride in. If nothing happens then don't sign up for COBRA. This saves two months of premium.
COBRA gives a 60 day grace period to free ride in. If nothing happens then don't sign up for COBRA. This saves two months of premium.
rbmrtn
Thinks s/he gets paid by the post
Prior to ACA the main reason ( to me ) to use COBRA is that taking and exhausting COBRA made you HIPAA eligible for insurance. You could then buy insurance without the denials ( usually limited to some special HIPAA policy or state risk pool )
Exchange and most employers will not allow HI sign ups outside of usu OE periods. If switching from COBRA to Exchange or other HI outside of OE period, is it customary for original employer (via their HR or COBRA office) to send some 'proof of loss of HI' to document this "Qualifying Event"?
If you either exhaust your COBRA benefits (18 months) or you choose not to take COBRA during the time period allotted (which you would have to look up - it may be only 30 days, not 60), those are considered qualifying events, at least my HR has told me so.
Sent from my iPhone using Early Retirement Forum
Sent from my iPhone using Early Retirement Forum
You have 60 days to elect COBRA and 45 days to make the payment. Once elected it becomes retroactive to your termination date. I know since I just went through this.
Prior to ACA you could not be uninsured for more than 63 days. If you went to day 64+ then any pre-existing condition could be considered by the insurance companies. Thus making many uninsurable or insurable at exorbitant rates. ACA prohibits pre-existing conditions from being considered so this is no longer an issue.
rbmrtn
Thinks s/he gets paid by the post
This only applied to group policies like when changing employers, the credible coverage certificate precluded any waiting period the new group plan imposed. You were still allowed to be turned down in the individual market ( things would have been much easier ).
What it did do for individuals was if you had group coverage, took COBRA and exhausted it, you could then go directly into a HIPAA eligible plan, That varied among states, many had a high risk pool ( even though you didn't have any pre existing conditions ).
http://www.dol.gov/ebsa/faqs/faq_consumer_hipaa.html
See last paragraph at bottom of link.
The question is not disqualification due to pre-existing conditions, it is documenting loss of insurance to allow enrollment in HI outside of normal OE period (either Exchange or other private/employer HI). For example, enrolling in Exchange in June would NOT be allowed unless you had a "qualifying event".....like exhausting COBRA. Or one takes a new j#b but uses their COBRA (ending outside OE period) because the old employer's HI was better than new employer's. Anyone know what form (or other documentation) is typically needed to prove this "qualifying event" that you had HI and are losing it outside OE period?
rbmrtn
Thinks s/he gets paid by the post
Yes, HIPAA requires they send you the credible coverage letter. It has your coverage end date on it.
Once on COBRA you can't switch until exhausted or the next Open Enrollment Period
In talking to the ACA folks... exhausting COBRA is not a qualifying event. Getting laid off or quitting work where you had coverage (and loosing it) is a qualifying event. I was laid off in November as my company went into bankruptcy restructuring. They provided paid cobra for a few months. I went through this in detail with the ACA help line. To go from cobra to ACA health insurance has to be done during open enrollment. You can stop Cobra at the appropriate time to make this work.
rbmrtn
Thinks s/he gets paid by the post
That is incorrect. See the FAQ on the exchange site
https://www.healthcare.gov/unemployed/cobra-coverage/
If your COBRA coverage is ending outside Open Enrollment, you qualify for a Special Enrollment Period. This means you can enroll in a private health plan through the Marketplace outside Open Enrollment.
You can't just drop COBRA until the next open enrollment.
This would mean I was given the wrong information from the ACA help line
yeah... but the world is changing so fast. got offered a job that I had not applied for... turned it down... then was asked to work for a few months so they could find someone else. so, I'm off cobra for the moment.
There advice would still have worked reasonably well for me at that time. Now is a different time... new decisions and conditions.
There advice would still have worked reasonably well for me at that time. Now is a different time... new decisions and conditions.
rbmrtn
Thinks s/he gets paid by the post
I think it depends what you asked. From your comment They provided paid cobra for a few months. , they may have given you the correct info. I'm not sure I know what paid COBRA is.
COBRA lasts for 18 months, regardless of who pays for it. Once you accept it you are on it. Your COBRA would be exhausted 18 months from when it started, not when they stopped paying for it.
There really is not a requirement that the employee has to pay for COBRA themselves. My company decided to pay for COBRA directly which makes the the COBRA free (tax free too) for the time covered by the company payments.
And you may be right that the answer may have been right.
With the company in bankruptcy... one can not be sure they will have a health plan for those remaining even as long as they offered to cover cobra... thus it could disappear at any time.
Bestwifeever
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Interestingly, my COBRA would last for 36 months--our lightly subsidized retiree health care ended when DH aged into medicare at the end of 2013 and I was offered COBRA for 36 months ("COBRA requires that continuation coverage extend from the date of the qualifying event for a limited period of 18 or 36 months. The length of time depends on the type of qualifying event that gave rise to the COBRA rights...."). I have a 19-month gap to cover before I qualify for medicare myself so this was good news for me. I wanted to stay on the same plan even though it is expensive imo at just over $1000/month (thanks to its low deductible, low OOP) for only my coverage as I have eye and other issues being monitored and was worried that ACA, which was just starting, might be vulnerable to screwups (imagine that) before it got rolling.
I did not have to stay on COBRA--I could have switched to other insurance during the open enrollment period that ended mid-December 2014. In fact the megacorp letter advising of the premium increase for 2015 gave subtle hints that the ACA might offer more palatable rates....
I did elect it, the company was just paying the premiums for a few months
