People often do not understand their options for affordable health insurance when they lose a job. When anyone faces a job loss, a divorce, a reduction in work hours, or a death of a covered sponsoring employee, they may be eligible for extended coverage under the employer’s employee benefit plans for up to 18 months due to COBRA legislation.
But know your options can save you hundreds or even thousands of dollars a year!COBRA is the Consolidated Omnibus Budget Reconciliation Act adopted by Congress to ensure that eligible people can continue to have access to their employer sponsored health care plan.
medical insurance is complicated. That is why insurance agents must study to pass a rigorous exam before they can become licensed to sell it. Most people never read their insurance policies and do not understand when their employers explain about their rights under COBRA. They make many mistakes that can be very costly. Here are a few common mistakes to avoid:
· People do not ask questions when they do not understand some detail about their rights under COBRA. They may feel embarrassed or intimidated about the thought of asking questions. No matter how stressful it may seem, understanding their rights is a high priority. Everyone should ask as many questions as they need in order to make an informed decision about medical insurance plans.
· People assume their former employer continues to pay for group health insurance. Nothing could be further from the truth. Anyone who participates in health insurance under COBRA pays 102% of the insurance premium.
· People often think they do not need medical insurance coverage. The reasons vary. Younger people think that since they are healthy, health insurance is an unnecessary expense. Others think they will find a job quickly. Not all employers provide health insurance coverage and these days, new jobs are hard to find. The lesson here is that young people do get sick, and it is a mistake for people to assume that all employers will provide group health insurance.
· People do not seek the help of an insurance professional. Paying for benefits under COBRA is expensive. Insurance agents have a number of options to fit the differing needs of individuals and families. They can do a medical insurance plan comparison that will contrast the benefits and costs to the person.
· Sometimes, people get the wrong idea, thinking that everyone qualifies for benefits under COBRA. That is not the case. The law specifies eligibility requirements. If an employer drops health care benefits, employees are not entitled to any protection under COBRA. This mistake goes back to assumptions. People should never make assumptions, but should instead ask questions to find out if they are qualified.
· Many believe that COBRA is health insurance. It is not. COBRA is an acronym that is short for the Consolidated Omnibus Budget Reconciliation Act. It is a law enacted to help people continue employer sponsored group medical insurance for a short period of time.
Health insurance agents work on behalf of the person buying insurance. They can offer consultations that help people understand all of their options in relation to health care coverage. They often have access to Blue Cross/Blue Shield, Aetna health insurance plans, and plans offered by other companies. Their expertise can aid people in making the right decisions about the health insurance needs, and affordable health coverage.