If your employer's health plan is governed by the federal Consolidated Omnibus Budget Reconciliation Act -- COBRA -- you may be able to take your insurance coverage with you when you leave your job. This is an option unless you were fired for gross misconduct. COBRA coverage usually lasts up to 18 months. During that time, your premiums can cost you more than when you were an employee.
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Setting COBRA Premiums
The health plan has to charge you the same premiums as employees, plus a 2 percent administrative charge. If you paid 100 percent on your premiums when you were employed, you wouldn't see any change beyond the 2 percent. If your employer paid part of the premiums, the company could now require you pay the full amount under COBRA. The Kaiser Family Foundation says employers in 2014, for example, paid more than $12,000 of the premium cost for the average employee. Once COBRA kicks in, the ex-employee has to cover the whole expense.
Costs and Benefits
Your benefits and expenses -- co-pays, for instance -- are the same as for regular employees enrolled in the plan. If the plan changes its co-pays or increases premiums for employees while you're in COBRA, your policy changes along with them. The plan has to announce any changes in advance of each 12-month premium cycle, so you shouldn't be blindsided. If your employer stops offering health benefits or goes out of business, you lose your coverage. COBRA doesn't help when there's no health plan.
Paying the Premium
You have to pay COBRA premiums to keep your policy. The first payment is due within 45 days of notifying the plan you'll accept COBRA coverage. After that, you're entitled to make monthly payments -- some plans may offer a weekly or quarterly option -- with a 30-day grace period. If you miss the due date, the plan can suspend coverage until you finally send in the check, then reinstate you.
Given the price of COBRA, it doesn't hurt to shop around for alternatives. Fox Business says that when pricing other policies you should look at co-pays and deductibles, not just the cost of the premiums. Weigh any cost savings alongside other factors, such as if the alternative plan's network includes your regular doctors. If you anticipate needing a specialist -- an ob/gyn or an oncologist, say -- confirm the plan you're looking at has good-quality doctors in that field.