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Question:


I’d like to leave my full time job and focus on my home business, which is taking off. However, I must maintain my benefits, such as health care. How can I do this reasonably?
-JudyBean


Answer:


If your employer has at least 20 employees and offers group health insurance, you’re entitled to 18 months of coverage after you leave your job under Cobra. (For wonky trivia buffs, that’s the 1986 Consolidated Omnibus Budget Reconciliation Act.) So the good news is that if you quit to concentrate on your business, you can be assured of continued health care coverage. You may not like the price, however. While you can keep the same health plan, you will be required to pay its full cost. That means not just the premiums that you pay, but the amount that the employer kicks in, too, which is often the bulk of the cost.
 
Employers get group rates – a volume discount – so you would think that it would be hard to beat Cobra. But employees who leave their jobs by choice or necessity and set out on their own often find cheaper coverage by shopping around. Another advantage to lining up your own policy is that you can get the one you want, not the one your ex-boss wants. You typically have 60 days after you leave your job to choose Cobra coverage, so if you’re going to try to find something better, you should get on it right away.
-Conrad de Aenlle



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