This week it’s Mission Health Insurance in my life. I’ve got to navigate this before my current job ends so this week, it’s the Week O Insurance at Breaking Even. More posts about this fascinating topic in the coming days!

Since I didn’t commit a felony and since my company has more then 20 employees (among a few other reasons), I qualify for COBRA, which stands for Consolidated Omnibus Budget Reconciliation Act.

Passed in the 1980s, it requires that employees can elect to keep their health coverage…if they pay 102% of the cost of the plan. (The extra 2% is administrative costs, apparently.)



So while you may have some money for health insurance taken out of your check, your employer likely kicks part of it in too. With COBRA they don’t do this anymore. I get why, I mean, it’s kind of like paying part of your ex’s rent after you break up.

At first glance, why the heck would anyone do this? COBRA, while expensive compared to a high deductible policy, is cheaper then it would cost for an individual to buy the same health insurance coverage. It’s kind of like picking a mid-priced wine. Probably a safe bet but you pay more for that safety.

Today, I got the official amount I’d have to pay each month to COBRA my insurance. I already knew ball park what it was going to be; that was the figure I used for health insurance when I calculated whether I could afford to quit my job and go into business full time. It will cost me about $350 a month to maintain my current coverage (!).



I have to decide within 14 days of finishing work whether I will COBRA or not (I can wait up to 45 days but then other financial penalties can come into play after 14 days). I can keep the coverage for up to 18 months after my job ends.

Clearly I am still gathering some information. Meanwhile, I’d love to know if you’ve ever COBRAed your insurance and whether you found it worthwhile!

More information on COBRA (via the government)
More information of COBRA (via eHow…better formatting)

Read related post “Week O Insurance: Real Benefits”…
Read related post “Week O Insurance: Health Insurance Co-ops”…



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