COBRA

COBRA

What we commonly refer to as COBRA, short-term health insurance for the unemployed, was included in the Consolidated Omnibus Budget Reconciliation Act of 1985.   It grants workers and their families the option to keep their group insurance health benefits for up to 18 months (although the exact time may vary depending on a number of factors). COBRA enables a worker to purchase health insurance through their ex-employer, if they are subject to a “qualifying event”, even though they no longer work there. A qualifying event includes the end of employment for any reason other than “gross misconduct”, or a reduction in work hours (again for anything other than gross misconduct). Only employers with 20 or more workers are subject to COBRA.

Cry Wolf Quotes

Many options already exist to provide unemployed persons with health insurance or protection against health care costs. These include: continuous coverage provisions in many employer-paid health care plans; the conversion privilege offered in many of these same plans: coverage under a spouse’s or other relative’s plan; and the social safety net, Medicaid.

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Jan Peter Ozga, Director of Health Care, U.S. Chamber of Commerce, Testimony, Senate Finance Committee.
04/21/1983 | Full Details | Law(s): COBRA

…we think that intervention should be limited….Our experience tells us that through Blue Cross and Blue Shield and also through a good deal of coverage offered by the commercial carriers there are opportunities for individuals who have been laid off to avail themselves of insurance of one kind or another in many cases.

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Bruce Cardwell, Executive Vice President, Blue Cross/Blue Shield Association, Chicago,Testimony, Senate Finance Committee.
04/21/1983 | Full Details | Law(s): COBRA

Unemployment always lags behind the business cycle and is highest when recovery has begun. In such periods, when pessimism is pervasive, costly proposals are often advanced, such as public programs to create jobs, mortgage subsidies, and health insurance for the unemployed. These proposals always prove to be unnecessary since they never get fully started until recovery is going strong. Furthermore, such programs would increase the federal deficit at a time when it needs to be reduced. This would mean applying the wrong solutions, which would increase the deficit, abort the recovery, reinflate the economy and continue unacceptable high levels of employment.

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Jan Peter Ozga, Director of Health Care, U.S. Chamber of Commerce, Testimony, Senate Finance Committee.
04/21/1983 | Full Details | Law(s): COBRA

We believe that the experience of the last few years teaches that in addressing problems of health care financing we should try at all costs to avoid the establishment of new Federal or State bureaucracies and regulatory regimes. We, further, should avoid the creation of new Government entitlement programs, the addition of new financial burdens on the Federal Health care budget, or the distortion of the marketplace by eliminating choice or reducing competition in health care.

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Don Bliss, Esq., National Association of Manufacturers, Testimony, Senate Finance Committee.
04/21/1983 | Full Details | Law(s): COBRA