Riddle me this...an insurace/COBRA question

[stomachmonkey]

Originally Posted by mreid

I've run HR for several companies and administered COBRA for 30 years. You will be fine not paying unless you need it.

Don't doubt your experience but you are offering advice based on your personal experience with plans that you have administered, and there are thousands of plans.

The plans you've had experience with have offered coverage retroactive to day of termination but that is a determination made by the specific plan, and there are thousands of plans.

The law does not require plans to offer retroactive coverage back to the original qualifying event, and there are thousands of plans.

Right to revoke a waiver of COBRA coverage
If a qualified beneficiary waives COBRA coverage during the election period, he or she must be permitted to later revoke the waiver and elect COBRA coverage, as long as the revocation is done before the end of the election period. If a waiver is later revoked, however, the plan is permitted to begin COBRA coverage on the date the waiver was revoked.

http://www.dol.gov/elaws/ebsa/health/employer/c09.htm?c=NNNNNNNNNNNNNY&CHNMW=

While Lendaddy is probably OK following your advice it is not a guarantee unless you have specific knowledge re how his plan will deal with it.

[KFC911]

Originally Posted by kiwiokie

One common mis-conception is that COBRA is some sort of government or independent health insurance plan. It is not. It is simply a government requirement on your company to allow you to continue coverage under your existing company medical insurance plan for a defined period of time after your termination date. It is expensive as it represents the full cost of medical coverage under your company plan (without any company subsidy). I agree that you should not sign up unless you need to claim.

Sorry 'bout a thread hijack, and I have NO experience with COBRA except for when I left my last corporate gig a few years back, but I'm confused about the above. I always thought "group rates" would be better than someone seeking individual coverage. While working, I had BCBS (at my termination), and the COBRA premiums would have been approx. 3 times the individual BCBS policy I opted for (similar coverage benefits). What am I missing here? Thanks...

ps: I was single, 48 yr. old male at the time with no "issues". Was I paying for the high costs of others that I worked with?

[mreid]

Stomachmonkey, the key here is he is not waiving coverage. He is simply not paying the premium within the 60 day allowed period unless he needs it. This is the COBRA law, not the plan details.

KC, company sponsored plans usually have lower deductibles and co-pays, better coverage, and better prescription coverage. In the past, almost every company plan was "better" and therefore more expensive. The problem with "better" today is that about 10 years ago insurance companies started offering a wide variety of tailored plans to meet specific needs of individuals instead of the higher cost one size fits all plans. This allowed people who don't need maternity coverage, are healthy and want catastrophic care only, or have young kids where prevention is more important to find more customized solutions. Unfortunately, these now non-compliant plans are why so many people will lose the plan they are happy with today. I don't want to send this to PARF, but this is only one of many downsides to the ACA.

It is also why he may not be able to find a suitable policy for his small window of time before his new policy kicks in and should take advantage of the payment terms mandated by COBRA.

[KFC911]

Originally Posted by mreid

...KC, company sponsored plans usually have lower deductibles and co-pays, better coverage, and better prescription coverage. In the past, almost every company plan was "better" and therefore more expensive. The problem with "better" today is that about 10 years ago insurance companies started offering a wide variety of tailored plans to meet specific needs of individuals instead of the higher cost one size fits all plans. This allowed people who don't need maternity coverage, are healthy and want catastrophic care only, or have young kids where prevention is more important to find more customized solutions. Unfortunately, these now non-compliant plans are why so many people will lose the plan they are happy with today. I don't want to send this to PARF, but this is only one of many downsides to the ACA.
...

Thank you for your insight! Don't want to PARF this thread either, but under ACA (according the BCBS site), I would be able to get a "new" BCBS policy with even better coverage/benefits, for approximately half of what I now pay. Don't know if I will go that route (once you go, you can't return) however...time will tell. I realize that being male/single/healthy has a LOT to do with this...I know of plenty of others who aren't as fortunate (the healthy aspect...not being single and male ). Thanks again...

ps: I can keep my individual BCBS plan "as is" (without going under ACA), with the "normal" 7% increase in annual premium (same as it's been increasing annually for five years now).

[stomachmonkey]

Originally Posted by mreid

Stomachmonkey, the key here is he is not waiving coverage. He is simply not paying the premium within the 60 day allowed period unless he needs it. This is the COBRA law, not the plan details.

OK, so the proper wording is you are covered for 60 days from the date of a qualifying event IF, a) you do not explicitly waive coverage, b) pay the premiums due within the 60 day period

That's important as some people may assume they need to take some action with respect to election of benefits and possibly screw themselves.

I think the use of retroactive in that scenario while technically correct is somewhat confusing / misleading.

[mreid]

KC, yes for every cloud, there is a silver lining. Even for some who lose their current plan, there will be better options. As you so aptly point out, depending on your situation and demographics, you may really benefit. Congrats!

Stomach, he should just wait for the COBRA letter as the dates will be specified. I think the term retroactive is misleading. Really, it is that you are covered for 60 days unless you don't pay your premium during that time period.