Skip to comments.The Conservative Case for COBRA Subsidies
Posted on 08/07/2020 10:55:28 AM PDT by Kaslin
The economy is starting to bounce back from the coronavirus, but a full recovery will take years. About 30 million Americans remain unemployed. And the Federal Reserve expects the jobless rate which currently exceeds 13 percent to remain above 9 percent through the end of the year, far above the historic low of 3.5 percent we recorded in February.
Simply put, Americans are struggling. Through no fault of their own, millions have lost their jobs and with it, their health insurance. Many are signing up for Medicaid or Obamacare.
Conservatives like me cringe to see so many people flocking to these deeply-flawed programs, which all too often trap people in poverty thanks to "benefits cliffs" that discourage enrollees from earning more.
Fortunately, there's a better way. My former colleagues in Congress could offer temporary subsidies to help Americans stay on their employer-sponsored health plans, even when they've lost their jobs. That'd be expensive, of course but realistically, government health insurance spending will rise no matter what during this crisis.
Helping people stay on their private coverage rather than turning to Medicaid or Obamacare is the least-bad, most-conservative option.
There is a system already in place to administer these subsidies thanks to COBRA, the Reagan-era program that allows employees who leave their jobs to stay on their existing health plans for as long as 36 months.
Currently, most employees with employer-sponsored health insurance pay only a fraction of their premiums. On average, employees are responsible for 30 percent of the cost of family premiums and 18 percent of the cost of individual plans. Employers cover the rest.
When people go on COBRA, they must pay the full cost of their insurance. In 2019, individual premiums averaged $599 a month, while family coverage cost a staggering $1,715. Plus, Americans who go on COBRA normally face a 2 percent administrative fee on top of that.
For many who have just lost their jobs, this coverage is unaffordable especially since premiums withheld from workers' paychecks are tax-deductible. In most cases, COBRA payments are not.
During the global financial panic in 2009, Congress subsidized COBRA premiums for many who lost their jobs. That subsidy lowered the cost of COBRA by nearly two-thirds for up to 15 months. But the program ended in 2011.
If ever there was a moment to bring back COBRA subsidies, it's now. Tens of millions of Americans are out of work, largely due to government-mandated lockdowns that curtailed economic activity across the country. Those measures may have been necessary, medically speaking. But they caused immense economic carnage. It's only fair that the government help repair that damage.
In the absence of premium support for COBRA, many of the newly unemployed will be forced to seek coverage through either Medicaid or the Obamacare exchanges.
They won't like what they find. Only two-thirds of primary-care doctors accept new Medicaid patients. And the least-expensive Obamacare plans often "feature" very limited provider networks to keep costs down. That means that unless Congress takes swift action, many Americans will lose their doctors at the worst possible time.
More than 180 million Americans rely on employer-sponsored health insurance, and nearly three out of four feel satisfied with their coverage. Forcing workers and families victimized by the COVID-19 economic crisis to drop health insurance they know and trust for deeply flawed government programs would add insult to injury. While not perfect, the employer-sponsored health insurance system still works better than either Medicaid or Obamacare. And we already have a template for subsidizing COBRA premiums from the Great Recession.
As Congress debates the next coronavirus relief package, helping unemployed Americans afford their health insurance ought to be a top priority. COBRA subsidies would minimize the economic fallout of the pandemic. And they'd keep millions off government-sponsored insurance programs. They deserve conservatives' support.
Whenever one reads the phrase “conservative case for (insert left-wing tenet here)”, it can be safely rejected.
I can't believe someone used the correct term "tenet" instead of "tenant!" I see that all the time and it drives me crazy. That, and using "defiantly" where "definitely" is the correct term is another one that you just have to sigh about and chalk it up to public schooling and the "whole word" method of teaching kids to read.
“Whenever one reads the phrase conservative case for (insert left-wing tenet here), it can be safely rejected.”
EXCELLENT POINT - We hear the same for Amnesty and Global Warming. It’s a free country and compromised people (I mean idiots) can say as they wish - but it is UP TO US to discount them, at least if we care about the future.
For some reason, when I see COBRA in a title, I think it’s about Joe Biden.
So you’re saying tenet is the correct word rather then tenant, right?
Or for you, 4x spell check? Just poking.
My first thought was “if you can afford a Cobra why would you need any kind of subsidy”?
It’s long past time to separate health insurance from employment. Karen in HR doesn’t need to be choosing my insurance for me.
No. It’s for all intents and purposes.
I guess my smiley face didn’t show upon your browser . . . ?
>> a staggering $1,715
Thats about right. Few understand this reality.
COBRA assistance is a good thing, but for how long 6 months?
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