Why is COBRA so expensive?

[FreeState]

I mean really... they want me to pay nearly $400 a month for coverage. I get $1600 a month in unemployment - thats 25% of my benefits. Are there any better alternatives?

(Just laid off a week and a half ago, trying to figure this all out...)

[XemaSab]

1. You got off easy; they wanted 600 from me

(and yes, I got the same $1600 and rent was $1100 of that.)

COBRA is bullshit.

[FreeState]

2. If it wasnt for my partner Im not sure how I could afford food

really, I just don't get how people live on $1400 a month. Its not enough to get by for most people (I have some saving, but after about 5 months Im going to be in trouble, and thats with cutting all my spending drastically ).

[XemaSab]

7. I hope things work out for you

I've managed to stay afloat, but things have been rough. :pals:

[glinda]

16. They got over $1200/mo from my husband and I. Thank goodness he went on

Medicare finally.

[ThomCat]

27. I had to pay just under $600 for mine until it expired too.

:(

[CoffeeCat]

3. It's expensive...

...because we live in a third-rate country that believes its citizens have no right to
affordable healthcare. You see, our job is to funnel money to the corporations--more
specifically, the health-insurance companies. We exist to enrich them. We are not entitled
to basic healthcare and dignity. It can only be purchased for a handsome price because that's
how the health-insurance companies want the healthcare system in this country to work. They
paid our politicians handsomely to ensure this profit-centric model lives on for years!

That's basically why.

[glowing]

4. On COBRA, you have to pay the full benefit money.. Your employer is

no longer providing their part in your benefit... Its one of the reasons so many support a single payer system.. Employee health care cuts directly into your wages one way or another.

[FreeState]

8. Yeah but what sucks about that is..

Up until 6 months ago I paid zero out of pocket. The company paid 100% - but then they made us pay for a portion of it because the company needed to save money, and now its gone out of business. So basically I've gone from paying nothing to paying 25% of what I take in...

[glowing]

11. Yes, its the reason many who are on the "healthy" side end up with

no healthcare in between jobs. I had to choose to eat or insurance at one time.. Eventually, I married into a plan.

[fairfaxvadem]

14. Exactly - you are paying "FMV" now in COBRA

Since you no longer get the subsidized version that you had while with that employer, you are given the estimated full premium bill or some approximation of it. Since they can no longer claim you as a tax break, they won't pick up the tab of about 80% or so of that amount.

This is why there was the bit in the health care bill about disclosing the full amount of the cost of employer-provided health insurance on W-2s. The theory is that "consumers," once they see how much their health care actually cost, would use it more efficiently, and not run to the doctor's office for every sniffle or for every ad on tv that turns us all into hypochondriacs. That we would all be in awe over the cost and thereby more respectful of what we were being given, gratis, by our generous employers, and we would really only use it when truly necessary and not for all the frivolous office visits we currently make.

Ugh. I don't know anyone who takes the time to go do the doctor's on a lark - I may visit my primary care doctor once a year, if that. And I dread it, considering the waiting room is usually packed with coughs, sneezes, you name it - every Typhoid Mary is there. I'm sure there are some who are chronic doctor-botherers. But that is a totally different (mental) issue than a blanket "over-utilization" of employer provided health insurance. On the one hand, the drug ads encourage us to "see your doctor if you have any of these symptoms," and on the other hand, we're accused of abusing and overusing our health care benefits, thereby making the entire system too expensive for everyone.

Well, which is it?

[patrice]

5. Because it's NOTHING. Just a gaurantee that you will be allowed to pay the whole premium, not just

your portion of it as you did when your were employed, but your portion + the rest of it which your employer used to pay for you.

[Buddyblazon]

6. Because they don't actually want you to use it.

Seems pretty simple to me.

[RagAss]

9. Because we're cheaper dead.

I'm really not joking here.

[white_wolf]

10. Is it bad

that every time I see that name i hear "Go Joe!" in my head?

[Maine_Nurse]

12. Be thankful you aren't in Maine

$359 per week maximum unemployment and average COBRA costs are over $800 per month for an individual.

[soryang]

13. 400 a month is cheap, it used to be much more

I was told by someone at work who had a major stroke and went past the family medical leave act limit of three months, that currently cobra is being subsidized by a fund put aside in the stimulus bill. I know it used to be over a thousand a month. It least it was for me several years ago. I couldn't afford it.

[tammywammy]

22. The cost depends entirely on what insurance you have at your job

The last company I worked with COBRA was $125/month. At my current job, I'd be looking at around $550/month. But I had really shitty insurance at the previous job and really good insurance here.

[The Second Stone]

15. Thats more unemployment and less COBRA than

I have ever seen. Still rough, but I'm just sayin.

[GreenStormCloud]

17. Because of adverse selection.

The people who keep COBRA are the ones who have to because they already have some illness. That pushes the cost for COBRA way up. I had to use COBRA back in 1997. It isn't really COBRA's fault but it is the whole stupid system. We need to scrap it all and go to fully socialized medicine.

[Gormy Cuss]

24. COBRA doesn't work that way.

It is not related to who opts for COBRA. The COBRA premium is based on the full premium charged for your coverage when you were a qualified employee under the employer's plan. The COBRA cost may also include up to 2% for an administrative fee. That's the maximum that can be charged. There are also several ways that the cost can be less than the full group premium.

[pulledpork]

18. Because employers pick up most of the cost

So when your employer no longer does, you are paying the full premium, and yes, it is super expensive. It shows you just how the true cost of healthcare for the average person is hidden most of the time.

[dflprincess]

19. This is not the cost of healthcare

it's the cost of having a for profit middle man controlling access to healthcare. Remember, they don't make money if you use their product - that's why they're pushing bigger deductibles and "coinsurance" amounts.

[pulledpork]

26. I fully agree

When I said 'cost', I didn't mean it was a straight service-for-fee relationship. The profit motive was more than implied. I was trying to explain the cost, not excuse it. :-)

I was trying to explain in simplest terms, how a person's insurance costs can go from $100/paycheck to $500/month without a paycheck. A very shorthand explanation, but goes a long way towards demonstrating that employers do pick up a large part of the (tax-deductible) tab. Why it costs $500/month then brings in the profit chain you described.

[kas125]

20. Nine years ago my ex was laid off from Lucent. Our cobra

which we couldn't even dream of paying when he wasn't working was $1,283 for us and two kids. As far as I'm concerned, COBRA is a joke.

[tammywammy]

21. Because you're paying for all of the insurance

Your company was picking up the difference between what you paid and the premium. It depends on what type of policy you had. At the last place I worked, COBRA for health cost $125/month, but we had really shitty insurance. If I went on COBRA from where I am now, it would be at least $550/month.

The problem with COBRA and people like you that are shocked, is that companies aren't advertising how much the insurance really cost. People think that the amount they pay each week or whatever is the cost. It's not. Where I am now, you can clearly see how much your insurance cost.

[Kablooie]

23. It was $1400 a month for me and my family. Luckily I didn't have to use it.

I almost did but got a job at the last minute that continued the insurance.

[LooseWilly]

25. Best alternative—go without.

Live on the edge.. and help drive the Health Insurance Companies bankrupt. It's win-win...

[ScreamingMeemie]

28. $2400/month after my husband died. I kept it until it expired and then

was not insurable due to a pre-existing condition. I sort of envy you. But I also know where you are coming from.

[prolesunited]

29. I would assess your risk level

If you are young and in good health, you might just want to roll the dice.

[SoCalDem]

30. Because you are being asked to cough up the share that was paid FOR you

in addition to what you used to pay..

We did it for 18 months in 1996, and even then it was over $900 a month for our family..damned near killed us, but we had to have coverage for our kids & 2 had pre-existing conditions so we could not even GET private coverage:grr: