COBRA Coverage Too Costly for Unemployed, Study Finds
More than 725,000 laid-off workers have lost their health insurance since the economy dipped into a recession in March, a report by the advocacy group Families USA has found, the Columbus Dispatch reports (Riskind, Columbus Dispatch, 12/5). About 345,000 of those laid-off workers have lost their health insurance since the Sept. 11 attacks on the World Trade Center and the Pentagon. Families USA adds that the 725,000 figure likely is an understatement as it does not include workers' dependents who have also lost health coverage, since those numbers are "incalculable" with currently available data. The study was based on unemployment reports from the Bureau of Labor Statistics and the U.S. Census Bureau (Families USA release, 12/4). Families USA is using the study to push for expanded federal assistance to help workers maintain their health insurance, and the report was released to coincide with congressional discussions over the economic stimulus package, the Dispatch reports. While federal law allows laid-off workers to keep their health coverage by paying 102% of the premiums through the 1986 Consolidated Omnibus Budget Reconciliation Act, or COBRA, the study found 80% of laid-off workers cannot afford to purchase such coverage (Columbus Dispatch 12/5). The average cost of COBRA coverage is $7,194 a year. Families USA Executive Director Ron Pollack said, "COBRA health coverage is a potential lifeline for laid-off workers. But, for most families, that lifeline is out of reach because it is unaffordable. A significant COBRA subsidy could change that and provide real protection for America's workers and their families" (Families USA release, 12/4). An economic stimulus package proposed by Senate Democrats included $12.3 billion to help unemployed workers purchase COBRA, but the measure was blocked last month. House and Senate negotiators are currently negotiating compromise stimulus legislation. The Families USA study is available at
http://www.familiesusa.org/media/pdf/cobra.pdf. Note: You must have Adobe Acrobat Reader to view the study.