In order to extend her maternity leave, my wife is taking an unpaid leave-of-absence from her job. Since this means we will lose her employer-paid health insurance and our child has an issue that requires regular doctor visits at this time, we knew that we would have to sign up for COBRA benefits. Our employer-paid coverage ended 9/30. Somehow due to an administrative mishap, we did not get the paperwork until the third week of October, by which we already had four different (expensive!) doctor visits.
I have written before about the ability to get retroactive COBRA benefits, so I knew that we would be okay:
You have 60 days after you lose your benefits to elect to pay for COBRA coverage. However, even if you enroll on Day 60, your coverage is retroactive to Day 1. Of course, you’ll have to pay the retroactive premiums for that period. Thus, you could technically waive your COBRA coverage initially, and then wait to see if you incur any medical bills.
Her employer uses the big benefit provider Conexis to manage their COBRA administration. We were able to make our COBRA plan elections online and even paid the premiums online via electronic bank transfer. The process was much smoother than I thought it would be; some parts of the healthcare industry are just so archaic.
Our coverage was retroactive to 10/1, and all of our healthcare providers had to resubmit their claims. One thing that I didn’t expect what that we had to get new insurance card and insurance numbers for everyone in the family. I was also surprised that we were able to pick and choose amongst our original workplace options (Dependent coverage, HMO, PPO, etc.) I thought that COBRA meant we would just continue on with our exact same plan as before. Just wanted to share our story in case anyone was wondering how it worked.
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Thank you for sharing this. My family is in an identical situation. I provided the health insurance, and am taking an extended unpaid maternity leave. We are on cobra as of 11/1. But this is our second rodeo – did the same thing with child #1. It’s certainly an eye-opener to pay 100% of your health insurance.
Two questions:
Did she already exhaust her FMLA? I believe you stay on normal employer health insurance during that time (at least my company says that in their handbook).
Do you have to meet annual deductibles again, or does that amount carry over to your COBRA policy.
When I elected COBRA mid-year, the annual deductible and amount towards OOP max carried over. In fact, my health insurance card and member ID didn’t change either. It was exactly the same plan that I had. Instead of employer subsidizing most of the premium, I paid it all. Everything else remained the same/carried over.
@Steve – Yes, she is taking 12 weeks of FMLA and 12 weeks of unpaid leave. We stayed on the normal employer plan with no changes during FMLA. I’m actually not 100% sure about annual deductibles as we are on an HMO with minimal deductibles and copays as long as we stay in-network.
@Pam – Interesting, thanks for sharing. I wonder when these 12 weeks are over, if we’ll go back to the old plan numbers or if we have to get another set of insurance cards.
Coming up on a very similar scenario. We will have a gap in coverage due to me switching jobs of about 21 days.
Of course my wife is pregnant and has a routine OB visit scheduled.
I am thinking of just paying this cash and God forbid, if anything serious, retroactively activating Cobra.
My question is, when showing up to doc and they ask for insurance cards, what do you say? U just say “I’m paying cash.”?
Thanks!
The scary thing about health insurance is when I see the bill and the “billed amount is like $5,000” but then the “insurance-negotiated price” is $200 and then my final bill is $25.24. So I’d ask ahead of time if they know how much it is going to cost if you pay cash, and if there is any way you can pay the “insurance-negotiated” price instead of the retail price.
We just got an “epi pen” for allergies, and the billed amount without insurance was $1,000!
My wife’s ob/gyn provider billed routine OB visits in the range of $99-200 to the insurance company. The higher end involved her being hooked up to fetal heart rate monitor. Jonathan is right, in that you may want to check in advance. I highly doubt the amount will be large enough to warrant going through the COBRA hassle.
why didn’t you sign up for ACA(obamacare)? wouldn’t that have been cheaper?
I did run a marketplace quote but it was close to the same price as our group policy premium as we don’t qualify for any subsidies on our current income. If you did qualify for subsidies, then yes it may be a better option. This way we also don’t have to switch carriers or worry about a new deductible/copay structure and we know our providers are in network. Our gap is only 12 weeks.
I work at one of the largest benefits administrators in the world, a Conexis competitor, and your experience was very unusual. In all likelihood, you encountered one of the new people who were brought on for Annual Enrollment, and they kind of did whatever but they got you enrolled. Annual Enrollment, from late September to mid November, is the biggest time of the year for these centers, so they hire scores of people off the streets, and then lay them off in December and January (Happy Holidays!).
What likely happened, from a back end perspective, is the representative you were speaking with re-ran a process he wasn’t supposed to, which resets the event, which allows you to select any coverage for the participant, in this case, you, and you can pick any plan you want. It’s obviously not how it’s supposed to work. COBRA is a continuation of whatever you previously had, and virtually never, unless it’s Dependent-Only COBRA, should new cards and ID numbers be required.
At least it all worked out for you, but ideally, everyone does their COBRA enrollment online, which is available for the grand majority of benefit administrators, so you can confirm all of the information. Out of Pocket Maximums and Deductibles carry over as long as coverage categories are not changed. In very rare cases, if coverage category is changed, a deductible could reset.
Thanks for the comment!