Starting the first week of Dec. 2009, millions of Americans will begin losing their special federal COBRA subsidies. These subsidies were distributed to laid off employees who were let go as a result of the financial crisis of 2008.
In March 2009, a nine-month subsidy was approved for laid-off workers who were receive COBRA benefits (an 18-month extension of employer health insurance). The special federal subsidy helped workers pay for their benefits by covering 65 percent of costs.
However, many of the subsidies are now set to expire this week. As a result, unemployed workers will be forced to pay 100 percent of their premiums. Since the subsidy is only set to last to the end of the year, those who lose their jobs after the end of December won’t be eligible to receive the subsidy at all.
Unfortunately, because the COBRA subsidies averaged $722 per month per family, according to Families USA, without the federal assistance, premiums will average around $1,111 per month. This equates to 83 percent of the average monthly unemployment check. For many, this means the option for health insurance will be no more.
There are affordable health insurance options out there, but with limited resources, what may seem affordable can still be impossible to finance. So unless another subsidy is approved and fast, the 46 million Americans currently without insurance may just skyrocket.
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