COBRA: Consolidated Ominbus Budget Reconciliation Act - What You Need To Know

COBRA Insurance coverage is something many people don't understand or how it works for them and the benefits they can draw from it. COBRA might just be what you’re looking for to fill those insurance needs. But lets look at what COBRA is and if it's in your best interest to continue it or end it.

COBRA is also known as the Consolidated Ominbus Budget Reconciliation Act of 1985 or COBRA for short. COBRA is still a very useful law to many and people still use it today. COBRA makes it possible to keep health insurance coverage from their employer for up to 18 months if their employment status changes. Some of these changes could be layoff, reduced work hours or a termination of employment by either party involved.

COBRA has helped countless Americans keep insurance coverage. Now, is it good for you or not? Many times when individuals lose health coverage they have a very hard time getting coverage in the private sectors for various reasons. If they do find insurance coverage it's extremely expensive and many times not feasible for the displaced worker. For the worker to continue his insurance coverage through his employer he must pay the monthly premium, which can add up because he's not getting a discounted price anymore.

Internet access has helped many people find various health care programs. Now people can get on the Internet and do their own research and find out which company can give them the best deal and will give them the most benefits for the money. Since the Internet encompasses so much information more choices and comparison-shopping has became the buzzword.

Now one of the most important questions you need to ask yourself is whether or not to continue COBRA insurance coverage from your employer. If you have many health problems that are being treated right now you probably should strongly consider using the COBRA insurance option. Having health problems with pre-existing conditions could make it very difficult for you to get insurance coverage. If you do get health care coverage it will be so expensive it wouldn't be worth it.

If you are changing jobs and you know that your new employer doesn't offer health care coverage or if you know you won't qualify for the new company's health plan then highly consider COBRA as a viable option. It is also a good idea not to have gaps in health care coverage, as this tends to get you a better deal.

If you tend to be on the healthy side then you can choose not use COBRA as an option. There are a few reasons for that. Being healthy you should shop around as you will be able to get better coverage and at a more affordable price. Insurance companies love to insure young healthy individuals as they know it usually costs them a lot less money therefore, they will be glad to give you a good deal on your health care needs.

There are a few things you should know about COBRA so you can make a very informed decision. Once your health care coverage is lost, you are given a 60 day grace period in which time you must chose to use COBRA or not, otherwise you will lose it all together. Once the 60 days has past, it is not offered again.  COBRA also has provisions that give certain former employees, retirees and spouses the right to get temporary continuation of health care coverage at group rates.

Some of the things that COBRA will continue to cover if you decide to keep the coverage are:

Inpatient and outpatient hospital care

Physician care is also covered under COBRA

Surgery and major medical benefits

Prescription drugs are also covered but life insurance is not covered under COBRA.

COBRA has many advantages and disadvantages and just like anything else an informed decision will take some time and research. COBRA has been helpful to many employees and will continue to provide coverage when needed for many more years to come. For some COBRA just doesn't fit into their plans; each individual will have to choose whether COBRA can benefit them.