Wednesday, March 11, 2009

Job losses jeopardize health coverage

RALEIGH, N.C. _ Nettie Shafer has a house, a car and about $1,000 left in savings. But the 59-year-old divorced bank teller risks losing all if she doesn't find a job with health insurance soon. Shafer, who lives in Raleigh, is on about a dozen medicines, seven of them to prevent a third heart attack. Now, the insurance coverage she retained from her former job at Wachovia has run out _ and the backup she has available covers only a fraction of her medical costs. "I'm still looking for a job, every day," Shafer said. "Something's around the corner. I truly believe that. "A survival job is all I need," she said.

The recession has not only cost thousands of people their jobs, it has also cost them affordable health insurance. People who had employer-sponsored health insurance are, when laid off, usually eligible for up to 18 months of continued coverage under COBRA, the federal law more formally known as the Consolidated Omnibus Budget Reconciliation Act. But COBRA is expensive.
Unemployed workers must pay the total premium. The monthly average is more than three times as expensive as what workers with employer-sponsored health insurance pay, according to data by the Kaiser Family Foundation and FamiliesUSA.

That can take a hefty chunk out of unemployment benefits. In North Carolina, the average COBRA premium for a family eats 82.4 percent of an unemployment check, according to data from FamiliesUSA, a consumer advocacy group. Many decide to take their chances and don't sign up for COBRA.At the end of 2008, an estimated 175,000 North Carolinians were out of work and uninsured, according to the N.C. Institute of Medicine. Though this includes people who lacked insurance before they became unemployed, the estimate represents a 75 percent increase since the end of 2007. The fourth quarter was particularly brutal in boosting the state's growing number of unemployed who are at risk of becoming uninsured, said John Quinterno of the N.C. Budget and Tax Center.

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