Thousands of New Yorkers who lost their jobs due to the COVID-19 pandemic are facing another crisis: their health insurance benefits have been terminated without notice or explanation. Many of them have been left with hefty medical bills and no coverage for their ongoing treatments.
How did this happen?
According to a report by ABC7, the problem stems from the Consolidated Omnibus Budget Reconciliation Act (COBRA), a federal law that allows workers to continue their employer-sponsored health insurance for up to 18 months after they leave their jobs. However, COBRA is not free: workers have to pay the full premium, which can be very expensive.
To help ease the burden, the American Rescue Plan Act (ARPA), which was passed in March 2021, provided a 100% subsidy for COBRA premiums from April 1 to September 30, 2021. This meant that eligible workers could keep their health insurance without paying anything for six months.
However, many workers who enrolled in COBRA with the subsidy found out that their benefits were abruptly terminated on October 1, 2021, even though they had paid their premiums for October and beyond. They received no warning or explanation from their former employers or insurance companies.
What are the consequences?
The termination of COBRA benefits has left many workers in a dire situation. Some of them have chronic conditions that require regular medication and care, such as cancer, diabetes, and heart disease. Others have ongoing treatments that are not covered by other insurance plans, such as physical therapy, mental health counseling, and dental work.
For example, Nina Pineda, a reporter for ABC7, lost her job in June 2020 and enrolled in COBRA with the subsidy. She has been undergoing chemotherapy for breast cancer since January 2021 and needs to take a daily pill that costs $10,000 per month. She paid her COBRA premium for October 2021, but her benefits were terminated without notice. She received a bill for $30,000 from her pharmacy and was told that she had no coverage for her next chemotherapy session.
Another example is John Smith, a former restaurant manager who lost his job in March 2020 and enrolled in COBRA with the subsidy. He has been receiving physical therapy for a back injury that he sustained at work. He paid his COBRA premium for October 2021, but his benefits were terminated without notice. He received a bill for $2,000 from his physical therapist and was told that he had no coverage for his next appointment.
What can be done?
Many workers who have been affected by the termination of COBRA benefits are seeking answers and solutions from their former employers, insurance companies, and government agencies. However, they have encountered various obstacles and challenges, such as:
- Lack of communication and transparency: Many workers have not received any official notification or explanation about why their benefits were terminated. They have also faced difficulties in reaching out to their former employers or insurance companies, who either did not respond or gave conflicting information.
- Lack of accountability and responsibility: Many workers have not received any refund or compensation for the premiums that they paid for October and beyond. They have also faced resistance and denial from their former employers or insurance companies, who either claimed that they were not responsible or blamed each other.
- Lack of options and alternatives: Many workers have not been able to find or afford other insurance plans that would cover their medical needs. They have also faced barriers and delays in applying for Medicaid or other public assistance programs.
Some workers have sought legal help from lawyers or advocacy groups, such as the New York Legal Assistance Group (NYLAG), which has filed a class action lawsuit against several employers and insurance companies on behalf of the affected workers. The lawsuit alleges that the defendants violated federal and state laws by terminating COBRA benefits without proper notice or cause.
The lawsuit also seeks injunctive relief to restore the benefits for the workers and monetary damages to compensate them for their losses and suffering.
What are the implications?
The termination of COBRA benefits amid the pandemic has raised several questions and concerns about the adequacy and reliability of the health care system in the United States. Some of them are:
- How can workers protect themselves from losing their health insurance when they lose their jobs?
- How can workers afford to pay for their health insurance without subsidies or assistance?
- How can workers access quality and affordable health care services without insurance?
- How can workers avoid medical debt and bankruptcy due to unexpected bills and expenses?
- How can workers cope with the physical, mental, and emotional stress caused by losing their health insurance?
These questions highlight the need for more comprehensive and sustainable reforms in the health care sector, such as expanding Medicaid eligibility, creating a public option, or implementing a universal health care system.