Understanding the COBRA Bridge Strategy and ACA Coverage Gaps

COBRA and the COBRA Bridge Strategy

Losing health insurance can be stressful, especially during a global pandemic. If you’re in this situation, understanding your options is crucial. When you leave a job with employer-sponsored health insurance, you may be eligible for COBRA (Consolidated Omnibus Budget Reconciliation Act). COBRA allows you to continue your former employer’s health plan for a limited time, providing coverage through a gap in employment.

However, COBRA premiums can be quite expensive, sometimes even more than the new plan you’ll be enrolling in. This is where the COBRA Bridge Strategy comes into play. This strategy involves going without health insurance for a short period, bridging the gap between your old and new insurance coverage. You’ll only sign up for COBRA if you need medical attention within that gap.

ACA and Coverage Gaps

The Affordable Care Act (ACA) eliminates the federal penalty for not having health insurance, but some states may impose their own penalties. Generally, there is no penalty for a gap in coverage that lasts less than 90 days.

Risks and Considerations

Before implementing the COBRA Bridge Strategy, carefully consider the following:

Health risks: Going uninsured for any amount of time can be risky, especially if you or your family members have any underlying health conditions.
Cost of COBRA: You’ll need to factor in the potential cost of COBRA if you do require medical care. Ensure that the savings from not having coverage offset the potential premium.
State laws: Check your state’s specific laws regarding coverage gaps and penalties.
Other options: Explore other affordable health insurance options through state exchanges or Medicaid.

Making an Informed Decision

Ultimately, the decision of whether or not to implement the COBRA Bridge Strategy is a personal one. Weigh the risks and benefits carefully and seek professional advice from a licensed agent if necessary. By understanding your options and making informed decisions, you can ensure you and your family have the health insurance coverage you need.

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