Some people with cancer leave their job temporarily or permanently. If health insurance is a benefit of employment and the employee leaves the job, the employer may no longer pay for any part of the health insurance. However, you probably have options to continue this health care coverage. If possible, it is very important that you keep your health insurance coverage.
For someone who loses or leaves their job, the Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that allows someone to temporarily continue their employer-based health insurance by paying the full cost of the insurance themselves. COBRA provides an important safety net for most people.
Coverage through COBRA can be expensive, and it is time-limited. Premiums of more than $1000/month are not uncommon. On the other hand, the cost of cancer care without insurance is usually far more than $1000/month. COBRA coverage can give you time to plan for future coverage.
How COBRA Works
The employer’s health plan administrator must provide notification of your right to elect COBRA coverage within 14 days of the job loss or other qualifying event. It is up to your employer to inform the insurance company that you are eligible for COBRA. You must sign up for coverage within 60 days and pay the monthly premiums dating back to the start of your COBRA coverage. Traditionally, coverage will continue as long as you pay the premiums on time for up to18-36 months, depending on the qualifying event.
Most COBRA plans do not send a monthly bill or reminder, so consider marking the date the premium is due on your calendar or some other place where you will be sure not to forget. If you are even a day late with a premium the insurance company may cancel your COBRA coverage, and they do not have to reinstate it.
If you are eligible for COBRA because you or your loved one left or lost a job, COBRA will last for 18 months. An additional 11 months of coverage is available if the Social Security Administration deems that a person became disabled within 60 days of electing COBRA.
Am I Eligible?
- You are usually eligible for COBRA, if:
- You have voluntarily left a job through which you had health care coverage
- you have involuntarily lost your job and employer-based health insurance without cause
- Your employer reduced your work hours so that you were no longer eligible for employer-covered insurance benefits
- Your health insurance was through a loved one’s employer, and your loved one voluntarily or involuntarily left his or her job
- Your health insurance was through a loved one who becomes eligible for Medicare
- You had health insurance through a loved one, and he or she dies
- You had health insurance through a spouse’s employer and you separate or divorce
If your employer goes out of business, you will not qualify for COBRA since the employer is no longer offering a health plan.
Most, but not all, employers are federally mandated to offer COBRA coverage. Employers that do not have to offer COBRA coverage include:
- The federal government
- Certain church-related organizations
- Employers who do not have 20 or more employees for at least 50% of the year.