- Free health insurance for Americans without job-based coverage through the COBRA health benefits program that was allocated in a government stimulus bill expires on Thursday.
- The $1.9 trillion American Rescue Plan passed in March created COBRA subsidies from April 1 through Sept. 30. Experts say there was huge demand for the six-month subsidy, with one estimate finding more than 16 million people lost their employer-sponsored health insurance during the COVID-19 pandemic and had to turn to alternate coverage options.
- Thursday's cliff means people using the COBRA subsidies should move to get coverage quickly if they haven't already, according to benefits experts.
Large employers in the U.S. are required to provide insurance to their employees by paying a part of their insurance premiums. If a worker becomes ineligible for health insurance benefits, which can happen if they're laid off or fall below a minimum number of work hours per week, the employer can elect to stop paying its share of insurance premiums.
In that case, COBRA gives such employees and their dependents the option to stay on their old coverage for a limited period of time, making it a valuable stopgap measure to retain health insurance coverage — especially during the pandemic.
However, it's typically very pricey, as beneficiaries have to pay the part of the premium they were previously responsible for while working, along with the often much larger share once covered by their employer.
The average total monthly premium for job-based coverage last year was more than $600 for individuals and almost $1,800 for families, according to the Kaiser Family Foundation. That cost is prohibitive for many U.S. families, though may still be less expensive than other individual health coverage plans.
People relying on the free insurance through COBRA should have already gotten a notice from their employer or insurer that the subsidies are ending, outlining whether they're still eligible for coverage through COBRA or a group health plan and how much their premiums will be without the assistance, benefits experts say.
If that new premium is too high for a person to afford, they're entitled to a special 60-day enrollment period on the Affordable Care Act marketplace, according to healthcare.gov. If a person has qualified for or received unemployment benefits for at least one week this year, they could quality for a plan providing additional help with copays and deductibles for a low monthly premium.
Medicaid is also an option for beneficiaries losing the free coverage. This year, Medicaid surpassed Medicare as the single largest source of health coverage in the U.S., following a sharp spike in enrollment during the coronavirus pandemic.
It's currently unclear exactly how many Americans took advantage of the COBRA subsidies during COVID-19, though estimates of how many lost their jobs last year range in the tens of millions.
For one, California's ACA exchange says 138,000 people will be losing their COBRA subsidies as of Thursday and will be eligible to enroll in an exchange plan.