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COBRA Health Insurance

Many Oregon employees are offered COBRA health insurance after they leave their employer’s group insurance plan. The premiums are often very high. The premium you are offered is the total cost of your actual health insurance plan – the portion you paid plus your employer’s contribution. Large employers typically offer a low deductible and small copay for doctor visits and prescription coverage.

COBRA health insurance will only last 18 months. After that period, most will be eligible for portability. The premiums for portability will be higher than COBRA. The premium for these plans comes as a shock to most employees.  The premiums are higher because the plans are not underwritten. In other words, you are guaranteed to have the plans no matter your health situation. The cost for a similar individual (or underwritten) plan is around 40% less than a COBRA premium.

Solutions (and alternatives) to COBRA:

  1. Apply for an individual plan. Your premiums will typically be lower. The nine month subsidy is very helpful; we suggest applying at the beginning of the eighth month of the subsidy. Keep in mind, every Oregon insurer has different guidelines. Call one of a Century Benefits specialist if you have questions on whether or not your condition is acceptable. We have seen savings of up to 75% of the COBRA premium.
  2. Find an individual plan that fits your needs. Many people in Oregon do not need a benefits-rich plan (such as one offered through an employer).  There are many options available during the enrollment period.
  3. Separate your family members. Many COBRA plans charge you for “children” regardless of how many are listed. If you have only one child, it may be wise to move them to their own plan. Another situation to separate family members is when one member has health issues and the other do not. Leave the member with conditions on the COBRA plan and apply for an individual plan for your other children.