ARROYO GRANDE, CA--(Marketwire - March 20, 2009) - As the unemployment roll continues to swell, businesses desperately looking for ways to further reduce operating costs are canceling employer group health plans. Faced with the prospect of being uninsured, thousands of employees all over the U.S. are scrambling to find alternative ways to cover their families.

At the same time, insurance companies offering individual medical coverage cannot hire and train new employees fast enough to keep up with the recent spike in private health insurance enrollments. One insurer stated that they are experiencing the busiest enrollment activity in fifteen years.

Budgeting health insurance premiums into a reduced paycheck can be difficult, at best. Obviously, people need a place to live and food; however, one night in a hospital can end up costing several thousand dollars. This creates a difficult dilemma for those who are unemployed. It has been estimated that for each 1 percentage point increase in the unemployment rate, about 1.1 million are added to the rolls of the uninsured. Additionally, more than 50% of American households have cut back on seeking medical care in the past year because of concerns about the costs, according to a new Kaiser Family Foundation survey. Where do people go to find help?

Some relief is coming from the new federal economic stimulus package. It provides a temporary 65% COBRA premium subsidy to many workers laid off from Sept. 1 of last year through the end of this year. But a problem for many is that COBRA can be prohibitively expensive. Under law, workers must pay the entire premium, plus a 2 percent administration charge. On COBRA, family coverage averages $13,000 a year. Even with the 65% subsidy, it may not even be an option for someone who is out of work. "In many cases, we are finding that private medical insurance offers a significant savings over a subsidized COBRA option," said Tom Carolan, Director of Client Services for BestHealthcareRates.com, a health insurance information site based in Arroyo Grande, California.

Since President Obama signed into law the $787 billion economic recovery effort last month, employers, laid-off workers, state officials and benefits attorneys have been scrambling to figure out the details of the very broad provisions that are designed to help the growing number of jobless workers continue health coverage. Many people have found themselves caught up in the confusion over yet-to-be-answered questions surrounding the stimulus package. Generating a lot of heat at the moment is the fact that to qualify for the subsidy, you must have lost your job between Sept. 1, 2008, and Dec. 31, 2009. People who lost their jobs earlier have been excluded. The limitations appear to be a concession to limit the overall cost of the subsidy program.

The stimulus package was released so quickly; it is not surprising that there are more questions than answers. Over the coming weeks, the U.S. Department of Labor is expected to release further clarification. Additional guidance is also expected from Health and Human Services as well as the Treasury Department.

"In the meantime," continued Carolan, "if you aren't eligible for the new subsidy, there could be another way to subsidize COBRA coverage. If you lost your job because of competition from exports or overseas outsourcing, the government will pay up to 80 percent of COBRA premiums through the Trade Adjustment Assistance Reform Act. Under this law, you can receive monthly payments or a year-end tax credit to offset COBRA premiums for up to three years." The subsidy already was available before the stimulus bill passed, but the new law boosts the subsidy rate from 65 percent to 80 percent.

If you're not eligible for any COBRA subsidies, look into other coverage alternatives. Can you get onto a spouse's employer-based health plan? Can your state insurance department or county health department tell you about any state or local programs to provide affordable medical coverage? Veteran's benefits may also be an option.

If none of these avenues work for you, look for an individual health insurance plan. You may be able to find lower premiums than you would under COBRA.

About BestHealthcareRates.com

BestHealthcareRates.com has helped thousands of individuals, families & businesses find affordable medical plans. Their website provides free research tools & health insurance quotes from many top insurance companies, which help consumers find the plan that best meets their needs. The Better Business Bureau's "Online Reliability Program" rates BestHealthcareRates.com A+. For more information visit, www.BestHealthcareRates.com (http://www.BestHealthcareRates.com) or call Tom Carolan Director of Client Services at 1-877-812-5111.