Only 9% of Unemployed Obtain COBRA Health Insurance

Laid-off workers who also lose their health insurance would need substantial financial assistance, covering 75% to 85% of their health insurance premiums, for their premium contributions to remain at the levels they paid while they were working, said the report by Michelle M. Doty, Dir. Survey Research, and his team.

The report also highlights that low-wage workers are at a particular disadvantage. Only 38% of of low-wage workers are eligible to receive COBRA benefits, because they don’t receive health insurance through their jobs. They tend to work for small firms aren’t required to offer COBRA, or are uninsured to begin with. Coverage options for low-income workers remain limited especially for childless adults because most lack a public coverage option. The authors say that policymakers should consider temporarily expanding Medicaid and SCHIP eligibility to unemployed adults with low incomes, with assistance for premium shares, to provide critical support to families.

66% of all current workers, if laid off, would be eligible to extend their health insurance under COBRA But for most people, COBRA payments are unaffordable, about four to six times higher than the amount of money they contributed to their health insurance when they were employed. According to the report, millions of the eligible could keep their coverage if they could get assistance with their premiums, which average $4,704 per year for an individual and $12,680 a year for a family.

“Americans are losing their jobs at an alarming pace and this report clearly shows that many people cannot afford to take on the expense of COBRA just as they lose their income,” said Commonwealth Fund President Karen Davis. “The number of uninsured Americans could grow markedly during this recession unless we take action to help unemployed Americans keep their health care coverage.”