Democrats offer bill to help unemployed stay on employer-based insurance

House Democrats introduced legislation on Tuesday to help workers stay on their employer-based health insurance plans even if they lose their jobs or are furloughed due to the coronavirus pandemic. 

The bill unveiled by House Education and Labor Committee Chairman Bobby Scott (D-Va.) and Reps. Steven Horsford (D-Nev.) and Debbie Dingell (D-Mich.) would expand COBRA, the Consolidated Omnibus Budget Reconciliation Act program, to cover the full cost of premiums for people who turn to it to keep their insurance after their jobs have been terminated.

“In the midst of a public health crisis, it is critical that workers and their families maintain access to affordable health care,” Scott said in a statement.

“Over the past three weeks, nearly 17 million Americans have filed for unemployment, and many of them are at risk of losing access to their employment-based health care coverage. The Worker Health Coverage Protection Act would provide immediate relief to workers and families by making sure they do not lose their health insurance in the middle of a pandemic,” Scott added.

The legislation would apply to anyone who has been impacted since the coronavirus crisis began in full force at the beginning of March and would remain in effect until six months after the end of the public health emergency.

The subsidies for COBRA would be available until affected people enrolled in other health insurance, whether that is another group health plan, a plan obtained through the marketplace created through the 2010 Affordable Care Act, or Medicare.

House Democrats offered a similar proposal for subsidizing COBRA premiums as part of a bill last month that outlined their priorities for the most recent coronavirus relief package, but it did not make it into the bipartisan deal that became law.

People who lose employer-based health insurance can already stay on their plans through COBRA, but it is often very expensive because people have to pay for the full insurance premium without the employer chipping in as it did before the job termination.

That has presented a growing problem during the coronavirus pandemic as millions of people are losing their jobs and insurance as businesses shut down. 

The measure would also apply to people who are furloughed and still have access to health insurance through their employers, but remain on the hook for their annual contributions to the premiums.

There is precedent for beefing up the COBRA program during an economic downturn. The 2009 economic stimulus bill passed by Congress in response to the recession subsidized 65 percent of individuals’ COBRA costs during the first nine months of unemployment. But many people found that even being on the hook for the remaining 35 percent of the insurance premiums could be cost-prohibitive with no income.

About 17 million people have applied for unemployment benefits over the past three weeks since the start of the coronavirus crisis.

The Economic Policy Institute estimated in a report published on April 2 that about 3.5 million workers likely lost their employer-provided health insurance in the preceding two weeks.

The U.S. is distinct among wealthy industrialized nations for linking health insurance coverage to employment.

About half of all U.S. workers receive insurance through their employer, according to the Kaiser Family Foundation.

Aside from COBRA, people can also sign up for health insurance plans through the Affordable Care Act exchanges if they have recently lost their employer-sponsored health plans.

The Trump administration has declined to allow a special enrollment period so that people who did not have health insurance before the pandemic began can sign up for plans.