COBRA's Federal Subsidy to End Sept. 1

The federal subsidy that allows the unemployed to continue to receive coverage from their former employer's health insurance plan is set to end next week.

The Consolidated Omnibus Budget Reconciliation Act of 1985, known as COBRA, allows laid-off workers to keep their former employer's health insurance as long as they pay for it themselves. In 2009, the federal government provided a subsidy for COBRA that reduced the cost for the unemployed by 65 percent.

The average monthly cost of maintaining COBRA coverage without the subsidy is about $1,137 for a family policy and $410 for an individual, according to calculations from The Kaiser Family Foundation. With the subsidy, costs plummet to a more affordable $398 per month for a family and $144 for individuals.

COBRA without the subsidy is pretty expensive, Antoinette Kraus, the project manager for the Pennsylvania Health Access Network, a coalition of 55 organizations that advocates for affordable quality healthcare, told the Pittsburgh Post-Gazette. I think people are just going to go without health insurance. There's not an interim solution for all these people who don't have health insurance.

Enrollment for COBRA actually ended in May 2010. Various extensions pushed the subsidies out for 15 months past that date, meaning the people who are still eligible will lose that benefit on Sept 1.

When it initially passed, analysts predicted the $25 billion COBRA subsidy would help more than seven million laid-off workers and their families across the country. In fact, a Kaiser Family Foundation study found that those retaining health insurance through the program doubled after the subsidies became available, indicating that many Americans will likely be unable to afford coverage after the Sept. 1 deadline.

In November, the Centers for Disease Control and Prevention reported that nearly 59 million Americans went without health insurance coverage for at least part of 2010. Federal health officials said 4 million more Americans went without health insurance that year compared to 2008.

Currently, about 9.1 percent of Americans are unemployed, according to the most recent statistics from the Bureau of Labor Statistics.