COBRA health-insurance subsidy to end

With little fanfare, the federal COBRA subsidy program that has helped millions of the recently unemployed afford to continue health insurance will expire next week.

In many respects, the end is symbolic since the program's enrollment ended in May 2010. Extensions stretched the subsidies out for 15 months and now the last of those eligible will lose that benefit Sept. 1.

Coming on the heels of Pennsylvania's ending the adultBasic insurance program, and with a stubborn statewide unemployment rate currently at 7.8 percent, "there's a group of people that have fallen through the gaps as we wait for health-care reform," said Antoinette Kraus, project manager for the Pennsylvania Health Access Network, a coalition of 55 organizations that advocates for affordable quality health care.

COBRA, an acronym for the Consolidated Omnibus Budget Reconciliation Act of 1985, gives laid-off workers the option of paying to continue receiving health benefits through their employer for a time, but often at a price that is steep for someone who is unemployed. The subsidies reduced that cost by 65 percent.

The Kaiser Family Foundation reported the average monthly cost of maintaining COBRA coverage without the subsidy is $1,137 for a family policy and $410 for an individual. With the subsidy, the cost has been $398 per month for a family and $144 for individuals.

"COBRA without the subsidy is pretty expensive," Kraus said. "I think people are just going to go without health insurance. There's not an interim solution for all these people who don't have health insurance."

The federally funded, state-run PA Fair Care program for "high-risk" patients who have been denied coverage because of preexisting medical conditions is expected to help about 3,500 Pennsylvanians in the next year, but it carries a $283 monthly premium. Applicants must have been without insurance for six months.

When the measure was originally passed, analysts estimated the $25 billion COBRA subsidy program would aid more than seven million laid-off employees and their families nationwide. One study found the number of those retaining health insurance through COBRA doubled after the subsidies became available.

What happens now is anyone's guess, but the signs are discouraging.

"The talk in D.C. is, 'Let's figure out a way to make cuts and get rid of programs that cost money,' and this program costs money on paper," Kraus said.

But ending the subsidies will carry a price, too, she said, as the uninsured and unemployed will resort to using more costly hospital emergency rooms for routine care.

There are signs of that happening already.

In a recent Hospital Council of Western Pennsylvania survey of its members, southwestern Pennsylvania hospitals reported a 70 percent increase in the charity care they provided in the January-March quarter compared with the same period a year earlier.