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Laid-off – Should I take COBRA?

COBRA Coverage

Laid-off workers who are eligible for COBRA (over 20 employees) are allowed to maintain coverage under the previous employer’s policy for up to 18 months, provided they pay the premium and possibly a 2% administration fee. Employees at companies with fewer than 20 employees are eligible for Illinois State Continuation coverage for up to 9 months at termination. In either case, if you qualify, the government will pay 65% of the premium and you would pay 35% for nine months.

You may have a viable option. When employees are young and in good health and/or their families are young and in good health, an individually purchased health insurance policy might save you money. Be sure to get full details on the coverage, limitations and exclusions. If you have a current or chronic health condition this may not be a good option. However, in many cases this is a nice option and can save you money. You can run your own health insurance quotes on

Are LTC Partnership Plans Good for You? What if you could protect yourself against future long term care (LTC) costs and pass a good portion of your lifetime’s savings for your children at a lower cost than ever before? In the 1980s, a trial “Long Term Care Partnership Program” was instituted in four states. The concept was to encourage people to purchase qualifying LTC policies to avert some of the expense that would otherwise be paid by Medicaid. This is done if a person who purchases a qualifying policy depletes their insurance benefits; they may then retain a specified amount of assets and still qualify for Medicaid, provided they meet all other Medicaid eligibility criteria. Typically the State will match dollar for dollar, what that means if your policy paid $200,000 in benefits you could shelter $200,000 of your own money.  Currently, the states that these programs operate in are: California, Connecticut, Indiana, and New York.

Good news, these plans will become available in Illinois on July 1, 2009. For those who have already purchased LTCi should also be alerted. Current and prior LTCi plans do not allow a person to shelter their own assets as stated above in Partnership plans. Current LTCi policyholders will, most likely, have the option to convert their present plan to a “Partnership Plan”. More on this in next month’s column.

Feedback From April’s “Aid & Attendance” Column: We have had a number of responses to last month’s column on the underutilized and little known V.A. “Aid & Attendance Program” (A&A). One of which was a wife of a Veteran. He has Alzheimer’s and she had to place him in a facility when she could no longer care for him. In a letter she explained that they had purchased a cottage in Wisconsin soon after they were married and they both cherished that cottage. Early on when he knew of his condition he pleaded with her never to sell the cottage. Unfortunately, she was reaching a “financial wall” and had to make plans for selling the cottage before she was alerted to the A&A program. She states that now it appears that she will be able to keep “their cottage and all of those memories of great times”.

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