According to a report released by Families USA, the national organization for health care consumers, many unemployed Americans find COBRA health insurance too expensive.

 

COBRA, the Consolidated Omnibus Budget Reconciliation Act of 1985, has as main goal to make health insurance affordable for unemployed Americans. The plan typically provides 18 months of health insurance to workers who have been laid off from a firm with 20 or more employees.

 

But, according to the report, COBRA costs on average eat up most unemployment benefits. Under the program, the individual must pay 102 percent of the policy’s full cost. As a result, more people who are unemployed won’t have health coverage either. The situation gets even worse if we were to consider that there are already 47 million people in the United States lacking health insurance.

 

Ron Pollack, executive director of Families USA said COBRA health coverage “is great in theory and lousy in reality. For the vast majority of workers who are laid off, they and their families are likely to join the ranks of the uninsured.”

 

The report found that nationally, the average COBRA premiums for family coverage consumes approximately 84 percent of unemployment benefits. Moreover, in 41 states and Washington, D.C., Cobra family coverage consumes at least three-fourths of average monthly unemployment benefits and in nine states, equals, or exceeds the average unemployment benefits. Where is this situation going to lead Americans, that’s something anyone can imagine, especially that the economic crisis in the United States seems to be just at the beginning.