Saturday, January 10, 2009
Unemployed get squeezed on health insurance
By Kevin Freking • ASSOCIATED PRESS • January 10, 2009 WASHINGTON — Newly unemployed Americans will have to spend about 30 percent of their jobless benefits, on average, to pay for health insurance through their former employer, a new report says. And if they want coverage for their families, the report by Families USA says, that will take more than 80 percent of their unemployment check. Unemployment hit a 16-year high last month as 524,000 jobs were cut. Workers who lose their jobs are usually eligible to maintain their health insurance through their old employer if they pay the premiums, plus a 2 percent administrative fee. The benefit is called COBRA insurance, after the law that established it. President-elect Barack Obama is proposing to spend $80 billion to extend unemployment benefits and subsidize health care for people who have lost their jobs. Families USA, a liberal advocacy group, says its report comparing average COBRA costs and unemployment benefits shows the need for the subsidy proposed by Obama. At present, for most people who lose their jobs, COBRA cuts too deeply into their government-paid jobless benefits. In nine states — Alabama, Alaska, Arizona, Delaware, Florida, Louisiana, Mississippi, South Carolina and West Virginia — the average premium for continuing family coverage through a former employer equals or exceeds unemployment benefits, the report says. As for individual coverage, in six states — Alabama, Alaska, Arizona, Louisiana, Mississippi and West Virginia — jobless workers would have to spend more than 40 percent of their unemployment insurance on COBRA premiums.
Posted by Blogger at 11:49 AM