— For those of you waiting for another COBRA subsidy to come along, the chances don’t look great.
A bill introduced by U.S. Sen. Sherrod Brown (D-OH) last year to extend the subsidy went nowhere, and he has not reintroduced it this year, according to a source in his office. And there’s not much else in the works given anticipation of health care reform, according to insurance experts and consumer advocates.
Leading up to the expiration of the subsidy, there have been many people dropping COBRA coverage because of the hefty price tag, said Carrie McLean, consumer health insurance expert for eHealthInsurance.com. But there are options, she maintained.
Here are some tips from the company for people who were former subsidy recipients:
See if you can save money in the individual market. If you’re relatively healthy, you may be able to purchase health insurance on your own at a cost similar to your formerly subsidized COBRA coverage, and for less than a full COBRA premium. However, if you are currently covered by COBRA and have a pre-existing medical condition, it is possible to be declined coverage in the individual and family market. Do not cancel your current insurance coverage until you are officially approved for a new plan.
Understand your government-sponsored options. Health care reform expands access to programs like CHIP (Children’s Health Insurance Plan to provide insurance to kids) and Medicaid but does not provide free coverage. You may qualify for assistance based on your income. For persons with pre-existing medical conditions, health reform also expands access to high-risk pools, also known as pre-existing condition insurance plans (PCIP). Though you no longer need to be declined coverage before you can qualify for a PCIP, you may still have to be uninsured for six months. To learn more about your government-sponsored options, contact your state department of insurance or the nonprofit Foundation for Health Coverage Education at coverageforall.org.
Get hip to HIPAA. HIPAA (the Health Insurance Portability and Accountability Act of 1996) is a law that guarantees access, for consumers who meet specific criteria, to special health insurance plans that do not have pre-existing condition limitations. If you can show that you have had ‘creditable health insurance coverage’ (which includes COBRA) without a gap of more than 63 days, you may qualify for a HIPAA plan. This is a good option for people who can afford COBRA at the full-price but have exhausted their 18 months of COBRA eligibility. HIPAA plans can be expensive, but they provide people with pre-existing medical conditions valuable access to coverage.
Make your consulting work official for health insurance and tax breaks. Many of today’s unemployed earn supplemental income by consulting or contracting. By officially going into business for yourself, you may qualify for group health insurance and special health insurance tax breaks. Depending on the rules in your state, you may be eligible for a small business health insurance plan with only one or two full-time employees (including yourself) – and you can’t be turned down due to pre-existing medical conditions. The 2010 health care reform law provides a tax credit of up to 35 percent of the money certain businesses spend on health insurance premiums for low- to moderate-income workers. Not all small businesses will qualify for the full tax credit, and rules for incorporating your business may vary from one state to another, so consult with your accountant.
Negotiate health care costs whenever possible. You may be able to save up to 30% off your medical bills by negotiating with your medical care provider. If you end up uninsured after the COBRA subsidy, you’ll no longer automatically benefit from the discounted rates that doctors and hospitals agree to accept as payment in full from many insurance companies. That means the charges listed on your medical bills may be substantially higher than others are expected to pay. Talk to your doctor or your hospital’s billing department to see if you can negotiate a discount for your care by paying up-front or creating a payment plan. Persons with Health Savings Accounts or enrolled in plans with high cost-sharing may also benefit by negotiating medical costs. Visit Healthcare Blue Book to learn more and find suggested prices for many standard medical services.