One Medical Insurance

So what does the ARRA mean to you and individuals that are trying to find “cheap health insurance“?

With the ratification of the American Recovery and Reinvestment Act of 2009 (ARRA) on February 17, 2009, the federal government moved quickly to implement its many provisions. Generally referred to as the “stimulus package” the ARRA was aimed at jump starting the economy, supporting individuals who have lost jobs and health insurance coverage, and to provide financial assistance to state governments facing huge budget deficits and falling revenues.

Where did all this money go?  The majority of the ARRA funds go to Medicare and state Medicaid programs in order to address the immediate health services needs caused by budget shortfalls.  The ARRA also strives to increase the quality of health care and its long-term economic efficiency by investing in healthcare technology and mandating its use by healthcare providers.   For the most part, none of the ARRA program will help individuals and families that need to obtain “cheap health insurance“.  That will have to wait until passage of the Health Care Reform bill.

However, there is one section of the ARRA aimed at providing assistance to individuals whose access to health care or coverage was reduced by the recession, but still need access to “cheap health insurance”.  If you became unemployed between September 1, 2008, and December 31, 2009, the government may pay for up to 65 percent of your COBRA coverage premium or they may provide coverage you can use if you are ineligible for other employer sponsored group health insurance programs.

Under federal law, individuals who lost their eligibility for group health insurance coverage (for example, due to loss of employment) may temporarily extend their coverage.  In general, they can extend their insurance policy by personally paying for up to 102 percent of the premium cost. This is commonly referred to as COBRA coverage and is intended to allow individuals and families extend their health insurance coverage by up to 18 months.  The COBRA option has not been that popular however, and most people who are eligible for it do not subscribe to the extended COBRA coverage. This is primarily due to the fact that the premiums can be prohibitively costly.

The ARRA lessens this financial hurdle by providing a 65 percent payment subsidy for up to nine months of COBRA coverage to individuals who become involuntarily unemployed during the defined time frame and have an annual income under $125,000 ($250,000 for families). Since many individuals declined COBRA coverage when initially eligible (mostly due to the high cost), the ARRA also provides a specific “second chance” sign-up period.

If you failed to enroll in COBRA coverage between September 1, 2008 and the enactment of the ARRA you may be eligible. Additionally, the ARRA allows, but does not mandate, employers to propose to recently unemployed workers the opportunity of changing to a lower cost health insurance plan than the one they had during their employment.

What does all of this mean?  It means that if you lost your job between the dates defined in this legislation, the ARRA may make your COBRA coverage or group health insurance plan more affordable through subsidies.  Contact the human resources department at your former employer to find out if you are eligible. Even if you refused enrollment in COBRA when you left your job, you may still be entitled to reapply for coverage.

If you find that you are not eligible for the COBRA subsidy or have other needs to find “cheap health insurance” you may want to check out the plans offered through the Insurance Specialists where you can get instant quotes and save up to 50%.

I hope you enjoyed the post. As Always, comments are welcome and encouraged.

To Our Success,

Mark