Biden Stimulus Calls for Free COBRA Health Insurance for Laid-Off Workers

Alexander Raths / Shutterstock.com

A clause in the latest Biden stimulus package eliminates Cobra premium payments through September.

See: If You Get a Stimulus Check, How Will You Use It? Take Our Poll
Find: COVID-19 Is Changing How (and Whether) We Take Care of Ourselves — and Our Healthcare Dollars Tell the Story

The government will pay 100% of  laid-off workers’ COBRA payments beginning April 1 and lasting through September, Forbes reports.

COBRA is a type of health insurance that typically allows people who leave a company to continue their company’s health insurance if they pay their normal premium plus the share that their employer was paying. COBRA typically has a maximum length of 18 months but is often too expensive to continue for more than a couple of months.

The average COBRA payment for individuals is roughly $622 per month, according to the Kaiser Family Foundation, making it difficult to keep up, especially if new employment hasn’t been found.

Make Your Money Work for You

See: 7 Steps to Take Right Away If You Lose Your Paycheck
Find: 10 Companies That Offer Health Insurance to Part-Time Employees

Biden’s stimulus plan allows for payment of both the employer and employee share of the COBRA premium, covering 100% of costs through Sept. 30, according to CNBC.

While the government subsidy covers the premium, you might still owe copays and deductibles depending on the treatments you receive.

Laid-off workers have the option of enrolling in COBRA for 60 days after their last day of work. However, if you turned down coverage in August 2020 because premiums were too high, you can now go back and enroll, CNBC reports. You do not qualify if you left your job voluntarily or are eligible for Medicare or another employer plan, such as your spouse’s or your new employer’s.

See: 5 Things to Negotiate at Your Job Other Than Salary
Find: 7 Money Moves to Make When Starting a New Job

COBRA’s main benefit is that you can keep all of your same medical professionals, as the relief bill staves off any need to change at least through Sept. 30.

After September 30th, you would be responsible for the full amount of the premium.

More From GOBankingRates

About the Author

Georgina Tzanetos is a former financial advisor who studied post-industrial capitalist structures at New York University. She has eight years of experience with concentrations in asset management, portfolio management, private client banking, and investment research. Georgina has written for Investopedia and WallStreetMojo. 

Untitled design (1)
Close popup The GBR Closer icon

Sending you timely financial stories that you can bank on.

Sign up for our daily newsletter for the latest financial news and trending topics.

Loading...
Please enter an email.
Please enter a valid email address.
There was an unknown error. Please try again later.

For our full Privacy Policy, click here.