Insurance: April 2009 Archives

USA Today reported Thursday that thousands of laid-off workers might not qualify for federal COBRA subsidies offered under the federal economic stimulus package because they worked for a small company that doesn’t provide the coverage or their former employer has gone out of business....

Though they are limited, there are options if you do not qualify for federal COBRA, says health insurance expert Nancy Metcalf. The federal subsidy also applies to state COBRA expansion programs that extend coverage to employees in firms with fewer than 20 workers, to whom the federal COBRA law doesn’t apply. But only 39 states have these programs, which may vary duration, restrictions, and eligibility from the coverage provided to workers under the federal law. Families with children who have lost jobs and do not have access to COBRA should immediately contact their local Medicaid agency to find out whether their children are eligible for their state’s Children’s Health Insurance Program. In some states you can earn up to 300% the Federal Poverty Level, or a bit more than $60,000 a year, and still be eligible. And in most states, families who apply for CHIP are automatically evaluated to see if they are eligible for family Medicaid coverage. Eligibility standards vary widely by state and are different for working and jobless parents.

Excerpted from ConsumerReportsHealth.org.

USA Today reported Thursday that thousands of laid-off workers might not qualify for federal COBRA subsidies offered under the federal economic stimulus package because they worked for a small company that doesn’t provide the coverage or their former employer has gone out of business.  Under the federal stimulus package, the government will subsidize 65 percent of the total COBRA premium, for up to nine months, for people who are involuntarily laid off from their jobs or have their hours reduced to the point that they no longer qualify for benefits. (The subsidy also applies to family members covered under an employee’s group plan.)

The White House estimates more than 7 million unemployed workers will qualify.  So, why are thousands being left out in the cold—without coverage?  According to Nancy Metcalf, a health insurance expert at Consumer Reports, one reason is practicality: it was lot easier to temporarily subsidize COBRA than to restructure and subsidize the flawed individual insurance market.

For more, see ConsumerReportsHealth.org. 

The Insurance Research Council has found that an alarming number of drivers are dropping auto insurance coverage to save money in the recession. The council believes the numbers will increase from one in every ten motorists to one in six by next year.

Premiums are far higher for drivers who have been uninsured than they are for insured motorists seeking a new policy.  "When the time comes and they want to get coverage back in force, it forces the insurance company to look at them as though they are an uninsured driver and that is very illegal in the state of Indiana," said insurance expert Stephen Nealon of State Farm Insurance.

Excerpted from WISHTV.com.