COBRA as a stopgap until new bennies start

[tuixiu]

(Sorry if wrong forum, the health forum seemed to be focused on health and health insurance issues with early retirees. I'm not retired yet so topic seems more about money)

I've given notice at my current company effective mid January and start a new job right away but new health insurance coverage doesn't kick in until beginning of February. I certainly don't want to be some tool you read about who has some major medical issue during a short gap in employment so owes $150k to some hospital.

People are telling me I don't even have to worry about it since I can take COBRA later as long as it's within 45 days and it applies retro and covers that time. So it seems I won't even have to pay, just wait out the two weeks and only elect COBRA if I have a medical event.

This seems too easy but cursory research on google seems to support it.

Am I missing something?

 

[ziggy29]

People are telling me I don't even have to worry about it since I can take COBRA later as long as it's within 45 days and it applies retro and covers that time. So it seems I won't even have to pay, just wait out the two weeks and only elect COBRA if I have a medical event.

This seems too easy but cursory research on google seems to support it.

Am I missing something?

No.

In fact, I would recommend not signing up for COBRA immediately. Do not explicitly decline it, but you don't have to sign up on the spot. You can sign up for it later, within 60 days of termination.

That's the neat thing -- even if you haven't already signed up to take COBRA, if you suddenly get sick or injured and need a lot of health care within that 60 day window, you can retroactively pay the premiums and be covered for the event -- even if you hadn't already accepted COBRA when the event occurred.

And if you wind up in another j*b or get other health insurance within that 60 day period, you never need to sign up for COBRA and you've saved some premiums. (And the gap in your coverage would be less than 63 days, which under HIPAA protects you from many preexisting condition exclusions.)

That 60-day window is the mother of all adverse selection and seems too good to be true, but it is.

 

[tuixiu]

Then I shall do nothing.

In fact I might even do more dangerous things like rock climbing, big wave surfing, and telling my wife her new obsession with retro polyester shirts isn't an appealing look. All in.

Thanks ziggy.

 

[tryan]

I can take COBRA later as long as it's within 45 days and it applies retro and covers that time. So it seems I won't even have to pay, just wait out the two weeks and only elect COBRA if I have a medical event.

I was told the same thing then learned that the health coverage I had was prepaid for a month ahead (like a 30 day grace period). So I think your covered one way or another.

 

[clifp]

Then I shall do nothing.

telling my wife her new obsession with retro polyester shirts isn't an appealing look. All in.

I don't think COBRA covers wife damage and I know it does NOT provide a death benefit.

 

[tuixiu]

Ruh roh, I was wrong new bennies don't start until 1st of month after 90 days. That's harsh man, freakin May 1st.

From the govt COBRA site I see this:

Plan participants and beneficiaries generally must be sent an election notice not later than 14 days after the plan administrator receives notice that a qualifying event has occurred. The individual then has 60 days to decide whether to elect COBRA continuation coverage. The person has 45 days after electing coverage to pay the initial premium.

Further advice appreciated here. Is it wisest to:

1. Go ahead and take COBRA

2. Wait 60 days to apply, then if health wait another 45 days to pay, and if still healthy blow it off and hope I survive five more days until new insurance kicks in.

3. Sign up for wife's insurance right away, which sucks because they have 1/family no 1+1 option so relatively expensive to add one person. When new bennies available May 1st I assume that's a qualifying event to drop hers and use mine?

4. Wait 60 days COBRA, if I survive then go to Ehealth.com for biggest deductible I can find single coverage?

Sheesh what a headache.

 

[bssc]

You could go to your local insurance company. I remember I got a 30 day policy from State Farm for a situation similar to yours. It was cheaper than COBRA but had a high deductible.

 

[Texas Proud]

To give good advice.... we need numbers...


But for ME... I would just sign up for COBRA and pay the high rate for the 90 days or so...

 

[tuixiu]

Unfortunately I'm not exactly sure of the COBRA numbers yet, and I forget the rates for wife's insurance will have her check at work.

I saw rates for as low as $60/month on ehealth for a $10k deductible.

Regardless of the numbers if I was going to purchase private health insurance wouldn't it be wisest to wait 60 days for the COBRA opt-in time to expire since I could be covered anyway, then go private route?

Does anyone know how the qualifying event works for spouse, like would I have to sign up right away or could I also wait 60 days then sign up for that too?

 

[dgoldenz]

Unfortunately I'm not exactly sure of the COBRA numbers yet, and I forget the rates for wife's insurance will have her check at work.

I saw rates for as low as $60/month on ehealth for a $10k deductible.

Regardless of the numbers if I was going to purchase private health insurance wouldn't it be wisest to wait 60 days for the COBRA opt-in time to expire since I could be covered anyway, then go private route?

Does anyone know how the qualifying event works for spouse, like would I have to sign up right away or could I also wait 60 days then sign up for that too?

If you have a break of more than 63 days of coverage and buy individual health insurance, you could be screwing yourself. That's a dangerous game to play. Insurance companies want to see continuous coverage. Are you eligible for a COBRA subsidy if you were laid off? If so, you would only have to pay 35% of the COBRA cost. The difference in monthly cost between a $10k deductible and $5k would be pretty small, so I would suggest looking at $5k if that is the route you're going.

 

[tuixiu]

Thanks again for kind counsel.

Yeah I fear that 63 day thing enough that I think I'm going to suck it up and jump on my wife's for a few months. I figure it's not worth playing the whole timing musical insurance sources, will just suck it up.