National Consumers League

The National Consumers League supports expanded COBRA coverage

By Sally Greenberg, NCL Executive Director

In a perfect world, every person in the United States would have quality health care coverage, irrespective of whether they were employed or whether their employer-offered health insurance. The National Consumers League (NCL) has long advocated for universal access to health insurance for every American.

For political reasons, however, we still have a hybrid, expensive, and patchwork health care system. Thankfully, the Affordable Care Act addresses some of these disparities for millions, but our health care system in the United States still leaves many gaps in who can get coverage. And now, with the COVID-19 pandemic, the gaps in our social safety net have been made very stark indeed. Estimates are that 27 million Americans who have lost their jobs have lost their health insurance as well, according to an analysis from the Kaiser Family Foundation.

An estimate from the Robert Wood Johnson Foundation found between 25 million and 43 million people could lose their employer-sponsored insurance in the coming months if job losses continue.

However, help is on the way.

The Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act passed the House of Representatives on May 15, 2020. The bill addresses the COVID-19-induced massive unemployment/loss of health insurance crisis for Americans who receive their health insurance through their employer.

The HEROES Act allows individuals eligible for Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage to maintain their employer-sponsored coverage after a layoff, reduction in hours or furlough without having to pay premiums through January 2021. The bill also would provide two special enrollment opportunities for individuals to obtain health insurance: (a) during the emergency period for Medicare-eligible individuals residing in an emergency area who have not previously enrolled in Medicare and (b) during an eight-week enrollment period for an Affordable Care Act exchange for individuals who are uninsured for whatever reason. The bill would authorize veterans without a disability or health insurance to qualify for special enrollment in the Veterans Affairs (VA) healthcare system for a 12-month period. Finally, the bill would expand the Medicaid expansion pathway provided for in Families First, which covered 100 percent of testing costs. HEROES would expand this pathway to include full federal coverage for COVID-19 treatment and vaccines without cost-sharing for certain Medicaid enrollees.

There are issues, of course, with handing over billions of dollars to the health care industry through expanded COBRA that they might not have received otherwise. Among them, they pay excessive salaries to their CEOs that should trouble all of us who pay insurance premiums.

There is also the possibility that increasing access to private insurance via COBRA subsidies could stunt nationwide efforts to expand Medicaid for more vulnerable populations, to some degree.

But this is a case where we cannot let the pursuit of perfection be the enemy of the good. For nearly 40 million Americans struggling with loss of employment, passage of the HEROES Act will mean that they will not have to worry that neither they, nor their families, will lose health insurance.

We agree with Actors’ Equity, which issued this statement before the HEROES Act was adopted, “it is time for Congress to consider a 100% COBRA subsidy to ensure that no one loses their health care in the middle of a pandemic.” Similarly, our friends at Families USA have echoed the call for fully subsidizing COBRA coverage for displaced workers, among other robust consumer assistance measures. To read more, click here.  

Fully or heavily subsidizing COBRA coverage will have multiple benefits - particularly for consumers with chronic illnesses who have already satisfied their annual deductible- who would either be faced with potentially starting a new deductible from scratch, or with an entirely new provider altogether. By subsidizing COBRA coverage, families will be able to seek medical care, access vaccines and testing for COVID, and will have the full array of health care protections. It is a measure that will be good for the entire nation and will lessen the already frightening and painful loss of employment.

As a result, NCL strongly supports the HEROES Act provisions to subsidize COBRA benefits to the many millions who have lost employment. The House of Representatives has done its part. Now we need the Senate to approve the HEROES Act and move it to the President’s desk for signature. The nation will be far healthier if everyone can have access to health care in the age of this catastrophic COVID-19 pandemic.