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COBRA subsidies for laid-off workers: an initial report card
Randall R Bovbjerg1, Stan Dorn, Juliana Macri
1Health Policy Center, Urban Institute, USA. rbovbjerg@urban.org
Issue Brief (Commonwealth Fund)
|February 27, 2010
Summary
The COBRA premium subsidy program increased enrollment for laid-off workers, but many still find coverage unaffordable. Higher subsidies and easier enrollment are needed to ensure all eligible individuals can access this vital health insurance.
Area of Science:
- Health Policy
- Economics
- Social Welfare
Background:
- The Consolidated Omnibus Budget Reconciliation Act (COBRA) provides health insurance continuation coverage.
- Laid-off workers often face challenges affording COBRA premiums.
- The American Recovery and Reinvestment Act (ARRA) introduced premium subsidies for COBRA.
Purpose of the Study:
- To evaluate the initial impact and implementation of the COBRA premium subsidy program.
- To assess enrollment trends and affordability challenges associated with the subsidy.
Main Methods:
- Analysis of initial reports on the COBRA premium subsidy program.
- Review of enrollment data and participant feedback.
Main Results:
- Substantial increase in COBRA enrollment with a healthier participant mix.
- Smooth program implementation and high awareness among eligible individuals.
- Significant affordability barriers persist for many eligible individuals, even with a 65% subsidy.
Conclusions:
- Current COBRA premium subsidies have improved enrollment but are insufficient to ensure universal access for the unemployed.
- Enhanced subsidies and simplified enrollment processes are necessary to cover all eligible individuals lacking affordable alternatives.
- Future subsidy extensions should align with existing COBRA and ARRA administrative frameworks.
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