“Kind of a good news/bad news situation here. Bad news is, youre being terminated. But, the good news is that you can continue your current health plan for 6 more months at 100% of the cost, which is right around $1,600 a month. So, ya know, everyone is a winner here.”
For anyone wondering why COBRA is so god damn expensive is because what COBRA actually is.
COBRA is really just rule that says you’re allowed to elect to keep your group health benefits offered by your employer:[https://www.dol.gov/general/topic/health-plans/cobra](https://www.dol.gov/general/topic/health-plans/cobra)
The thing is! The employer is not required to pay a portion of the premium and instead you’re required to pay the entire premium personally. The benefit you’re getting is the discount on the premium that being part of a group plan offers.
See, back before the ACA (affordable care act/obamacare) there was no access to group plans unless you were affiliated with an organization that offered one (i.e. your employer). If you attempted to get healthcare as say someone self employed… well… it would cost A LOT. Like you think COBRA is expensive? No… individual plans are INSANE. This is why the ACA/obamacare implemented public group plans. So that you can get a slightly cheaper plan by pooling self-employed/under-employed people together into their own group plan. Unfortunately though these plans are still often more expensive than employer plans because they don’t come with employer contribution. They’re just cheaper than individual plans. This is also why the ACA also pushed to have states expand medicare/medicaid in their states which would include putting money into these public group plan pools to act similar to an employer contribution just without an employer. But of course, many states refused to partake, and this portion of the ACA was gutted.
…
Now back to COBRA.
So that increase in price upon leaving is because your employer is not paying the on average 80% of the premium, leaving you the 20%. So when they stop and you have to pay the other portion your premium sometimes goes up by 5x. It goes up less as a multiplier for family plans since employers don’t usually cover as much on family plans… but family plans are also way more expensive so regardless it still hurts. You may only see a 3x increase on a family plan, but the family plan was like 500/month already rather than the average 150/month for single person plans through an employer.
Here’s the thing though. The fact your employer covers average 80% of your insurance premiums means that is PART OF YOUR COMPENSATION PACKAGE!
If you’re making 40K a year, and you get insurance through your employer. Since on average a group plan will be 8K/year per person with about 1500-1800 coming from employee. This means really the employer is compensating you ~46K per year (if you consider you’re technically getting that untaxed… it’d be as if you got 48K taxed).
The reason I say this is that while it feels like only 5% of your income is going to insurance when you make 40K. REALLY it’s more like 18% of your income is going to insurance. It’s just the method in which it gets into the pockets of the insurance company feels invisible to you. So it FEELS like only 5%.
Note – I picked 40K because it’s roughly the US median income for a single person. When we use family median income of 75K, and the average family insurance plan rate which is like 400/month after employer contribution we again get a percentage of like 6-7%. BUT when we use the actual family premium rate of 22K/year (because again, the employer is covering that which is actually your compensation), it’s like your family made 92K instead of 75K, but paid 22K in insurance. Meaning it’s 25% of your income!!!!!
COBRA sucks in that it’s outrageously expensive. Yes.
But really COBRA is just giving you a short term glimpse of how FUCKING INSANE insurance premiums are in our nation.
That price you see when you get COBRA is what insurance ACTUALLY COSTS! That’s how much insurance companies are making! The only thing that shifted is whose bank account the money comes from.
18-25% of income average premiums is fucking outrageous.
I bet upper-management gets a lot of snakes in the mail.
Wrong sub?
Btw this COBRA will cost you $1400 a month, I’m sure you’ve got enough savings to afford that while on unemployment tho.
I came here to fight G.I Joe.
You don’t want either cobra
Throw it in the boss’s boss office on the way out?
I’d rather take this cobra.
send it to my former boss.,
cobra $450 a week.
Unemployment $450 a week.
I’m sure you dont have rent/food/utility/transportation bills. Good luck.
“Kind of a good news/bad news situation here. Bad news is, youre being terminated. But, the good news is that you can continue your current health plan for 6 more months at 100% of the cost, which is right around $1,600 a month. So, ya know, everyone is a winner here.”
For anyone wondering why COBRA is so god damn expensive is because what COBRA actually is.
COBRA is really just rule that says you’re allowed to elect to keep your group health benefits offered by your employer:[https://www.dol.gov/general/topic/health-plans/cobra](https://www.dol.gov/general/topic/health-plans/cobra)
The thing is! The employer is not required to pay a portion of the premium and instead you’re required to pay the entire premium personally. The benefit you’re getting is the discount on the premium that being part of a group plan offers.
See, back before the ACA (affordable care act/obamacare) there was no access to group plans unless you were affiliated with an organization that offered one (i.e. your employer). If you attempted to get healthcare as say someone self employed… well… it would cost A LOT. Like you think COBRA is expensive? No… individual plans are INSANE. This is why the ACA/obamacare implemented public group plans. So that you can get a slightly cheaper plan by pooling self-employed/under-employed people together into their own group plan. Unfortunately though these plans are still often more expensive than employer plans because they don’t come with employer contribution. They’re just cheaper than individual plans. This is also why the ACA also pushed to have states expand medicare/medicaid in their states which would include putting money into these public group plan pools to act similar to an employer contribution just without an employer. But of course, many states refused to partake, and this portion of the ACA was gutted.
…
Now back to COBRA.
So that increase in price upon leaving is because your employer is not paying the on average 80% of the premium, leaving you the 20%. So when they stop and you have to pay the other portion your premium sometimes goes up by 5x. It goes up less as a multiplier for family plans since employers don’t usually cover as much on family plans… but family plans are also way more expensive so regardless it still hurts. You may only see a 3x increase on a family plan, but the family plan was like 500/month already rather than the average 150/month for single person plans through an employer.
Here’s the thing though. The fact your employer covers average 80% of your insurance premiums means that is PART OF YOUR COMPENSATION PACKAGE!
If you’re making 40K a year, and you get insurance through your employer. Since on average a group plan will be 8K/year per person with about 1500-1800 coming from employee. This means really the employer is compensating you ~46K per year (if you consider you’re technically getting that untaxed… it’d be as if you got 48K taxed).
The reason I say this is that while it feels like only 5% of your income is going to insurance when you make 40K. REALLY it’s more like 18% of your income is going to insurance. It’s just the method in which it gets into the pockets of the insurance company feels invisible to you. So it FEELS like only 5%.
Note – I picked 40K because it’s roughly the US median income for a single person. When we use family median income of 75K, and the average family insurance plan rate which is like 400/month after employer contribution we again get a percentage of like 6-7%. BUT when we use the actual family premium rate of 22K/year (because again, the employer is covering that which is actually your compensation), it’s like your family made 92K instead of 75K, but paid 22K in insurance. Meaning it’s 25% of your income!!!!!
COBRA sucks in that it’s outrageously expensive. Yes.
But really COBRA is just giving you a short term glimpse of how FUCKING INSANE insurance premiums are in our nation.
That price you see when you get COBRA is what insurance ACTUALLY COSTS! That’s how much insurance companies are making! The only thing that shifted is whose bank account the money comes from.
18-25% of income average premiums is fucking outrageous.
How awesome would it be if this was an actual choice? I’m taking the cool snake over the shitty, overpriced healthcare everytime.
I want the snek!
If someone can afford COBRA they have enough money that they didn’t need to work anyway.