As much sense as a subprime loan

Jan 27 2009 by Derek Torres Print This Article

Growing up in the US, there are many, many aspects of the American workplace that I assumed to both normal, logical, and correct. After all, besides at will employment, I seemed to have an easier time of it than my father did, as he had an easier time than his father did.

Fortunately, I was bit by the travel bug and decided to go see other lands. This sense of curiosity led me to see that there's more than one way to skin a cat, and above all, that my countrymen are all too often getting screwed at work.

To what do I owe this rant? This time around, it's due to an article on COBRA. For those of you who never heard of it, and will regret you learned about it in another paragraph or so, COBRA is health coverage for those who worked in companies where health coverage was available, but have since lost their jobs.

Sounds nice, right? The catch is that it is only available for a limited time, and that you get to cover the entire cost of the insurance. What a deal.

While someone, somewhere out there may think this is fair play, I fail to see the logic. After all, when unemployed, you are actually making less money than you were prior to losing your job. If you've ever been on US unemployment, you know how far your payment doesn't go. Further, you may have actually paid anywhere from 10-50% of your health care premium. If your earnings go down, yet temporary health care coverage jumps 50-90%, how does one handle that? It makes about as much sense as a subprime loan.

Of course, if you can't afford to pay the exorbitant rate of COBRA for your entire family, yet you have an ill wife who can't afford to go without coverage, you can elect to pay a single coverage rate instead of a family plan. How generous.

Personally, the last time COBRA was an option for me, I was facing a bill of approximately $2,000 per month. This is about the same amount that unemployment paid per month. Given the current economic climate, this might be an ideal time to rethink the COBRA plan and work towards getting American health coverage separate from our employment.

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