Workers who have been laid off since Sept. 1 should expect to receive letters starting tomorrow from their former employers telling them how to get health insurance for less money.
"Saturday is a very critical deadline" for employers, Kathleen Stoll, executive director for Families USA, an advocacy group for affordable health care, said yesterday.
Under this year's federal economic-stimulus law, employers must notify laid-off employees that they can buy COBRA insurance, or company-sponsored health insurance, with a 65 percent subsidy for nine months.
Laid-off employees who do not receive the letters soon should contact their health-plan administrators, said Amy Turner of the Department of Labor's Employee Benefits Security Administration.
Federal law requires companies with 20 or more workers to permit former employees to participate in the company group plan for 18 months - with the worker paying the premiums.
While those group premiums are often less than the coverage a person could obtain individually, health insurance still may not be affordable: The typical monthly family COBRA premium is $1,069, Families USA said, while the average monthly unemployment benefit is $1,278.
Some people drop health coverage or shop for cheaper alternatives. But finding them may not be easy.
"If someone has the misfortune to get seriously ill when they are laid off and uninsured, they may have a really hard time getting access to care, and they may be saddled with medical debt," said Cheryl Fish-Parcham, deputy director at Families USA.
The stimulus law provides $24.7 billion for nine months of reduced COBRA premiums for an estimated seven million people who lost their jobs or will lose them between Sept. 1, 2008, and Dec. 31, 2009.
People who had decided not to use COBRA because of the cost now have a second chance. They have 60 days to act after they receive the letter from their companies.
The subsidy applies to large companies unless states pass "mini-COBRA" laws that extend subsidies to companies with 20 or fewer employees.
New Jersey has passed a mini-COBRA law; Pennsylvania has two versions pending.
For information, call the U.S. Department of Labor toll-free at 1-866-444-3272 or visit the department's Web site at http://www.dol.gov/ebsa/faqs/faq-cobra-premiumreductionEE.html
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