When You Need Health Insurance Most It's Out of Reach

Cobra insurance is too expensive - especially after a lay off. Every worker in the United States is guaranteed the right to continue purchasing health insurance from his or her employer after losing a job. COBRA regulations are intended to allow continual insurance coverage for employees and families during a job search. COBRA is an important benefit since many people have what insurance people call "pre-existing conditions" - chronic health problems such as asthma, heart disease or high blood pressure. Without continual health coverage, job seekers may have these chronic problems excluded from coverage for a set period of time when they finally land new jobs. Federal regulations do not allow exclusions of pre-existing, chronic health conditions if the applicant has been continually covered by health insurance at the time of application for new coverage.

All of this can be very valuable employee right except for one detail. Under COBRA, the employee pays the full cost of the company's health coverage. This larger amount includes the potion of the premium that the employee was paying plus the portion that the company was previously paying for that employee. The employee can be faced with monthly premiums that are triple the amount he or she had been paying while still employed.

It's ironic. At the time when an ex-employee needs coverage the most, the cost becomes prohibitive for most families.

I believe there would be a market for a specialty insurance product that employees could select for their benefit package. The employee would pay monthly payments for an insurance warranty. If the employee were laid off from the company, a fully funded warranty program would pay the COBRA premium during the full length of COBRA eligibility or until new employment.

There are benefits to the company as well. The human resources divisions of most companies despise COBRA. They must sign the employee up, track payments, and delete the employee from coverage if monthly payments are not made. It's a bookkeeping nightmare for smaller companies. With a COBRA warrantee program, the burden is lifted; the warrantee company makes the COBRA payments, keeps the books, and handles any administration problems.

A COBRA warrantee program will help assure that all Americans can continue coverage during times of unemployment. In this time of job uncertainty and expensive health insurance premiums, there should be a ready market for this time of offering. It's time for a COBRA warrantee program.