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Is COBRA a safety net for me?
Jan 19, 2006

I work for a company that may be on the verge of bankruptcy. I have not been paid a salary for 4 months. The company continues to pay medical benefits to BCBS. It appears that I have 2 options. 1. Resign from my job to get COBRA or 2. Stick it out further and hope for the best.

My concern is if the company declares bankruptcy, wheter I stay employed or resign, will my COBRA benefit no longer be available to me. I understand that group medical insurance would no longer exist in a banktruptcy and COBRA would not be available. Therefore, wheter I resign or stick it out, in either case my COBRA benefit will expire leaving me with no medical insurance. Is this true?

Can I get medical insurance under any rule without a pre-existing condition if I am forced out of my medical plan due to an employer bankruptcy?

I have no idea how I would pay for individual medical insurance to begin with having not been paid for four months, but I need to least know how I can continue getting medical care un til I can find new employment.

So...the question again is am I screwed with "COBRA" laws?

Thanks for your help.

Response from Ms. Franzoi

Since COBRA only affords an individual the right to continue coverage under an employer's health plan, if your employer were to file for bankruptcy and cancel his BCBS group plan, there would be no plan available for you to be covered under as a COBRA participant. If you were to lose coverage either as an active employee or as a COBRA participant because your employer no longer provided a group health plan, you could apply for a HIPAA policy. Any insurance company that offers individual policies must extend an HIPAA policy to you as long as you don't have a break in coverage greater than 63 days.

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