The Doctor Is In: Stimulus package takes much of the bite out of COBRA

If you've lost your job, or are about to, good news: The cost of your health coverage may have just dropped by two-thirds. The massive price break comes courtesy of President Obama's economic stimulus package and a clause applying to workers who qualify for COBRA (Consolidated Omnibus Budget Reconciliation Act), the 1986 law which allows terminated employees to continue on their previous employer's health plan for 18 months after their departure.

For years, COBRA provided a reliable and relatively inexpensive safety net for workers in between jobs. As long as your workplace employed at least 20 people, you had the option of continuing your health coverage -- provided you picked up 100% (or in some cases 102%) of the cost -- at group rates. The problem is, the cost of monthly health insurance premiums -- for everyone -- has skyrocketed. Last year alone, according to the National Coalition on Health Care, employer health insurance premiums increased 5 percent, or two times the rate of inflation. The annual health insurance premiums for a family of four now average nearly $12,700, and for singles more than $4,700 -- and that takes into account people whose employers are still picking up a portion of the biill. COBRA recipients, in other words, were getting hammered.