by

Gail Shearer
Director, Health Policy Analysis
Washington Office

and

Susanna Montezemolo
Esther Peterson Fellow
Washington Office

Endnotes

1. Owcharenko, Nina, "Providing Health Care Security for Displaced Workers," The Heritage Foundation Backgrounder, October 2, 2001.
2. Employment and Training Administration, U.S. Department of Labor, "Unemployment Insurance Weekly Claims Report," October 18, 2001. Available at www.dol.gov/opa/media/press/eta/ui/current.htm.
3. COBRA enrollees must pay 100% of the full cost of the health plans (previously paid by both the employee and the employer) plus 2% to cover administrative costs. We arrived at the average cost figures in the following way. According to the Kaiser Family Foundation's "Employer Health Benefits 2001 Summary of Findings," the average monthly premium costs for covered workers, single and family coverage, was $221/month for single coverage and $588/month for family coverage. Each of these was multiplied by 12 for one year, and then multiplied by 1.02 since COBRA enrollees must pay 102% of the full cost of the plan.
4. Zuckerman, Stephen, Jennifer Haley, and Matthew Fragale, "Could Subsidizing COBRA Health Insurance Coverage Help Most Low-income Unemployed?" Health Policy Online, The Urban Institute, October 17, 2001. Available at http://www.urban.org/health/HPOnline.htm.
5. People tend to stay in their jobs longer than they would if COBRA were more affordable. This "job lock" leads to a less productive economy overall. The more that workers fear losing their health insurance or not being able to afford health insurance after leaving a job, the more they stay in less productive, less satisfactory jobs. This leads to a lower standard of living in the long term. COBRA currently reduces some job lock, but subsidizing COBRA premiums and providing a Medicaid wrap-around would do even more to reduce job lock. Gruber, Jonathan. "Transitional Subsidies for Health Insurance Coverage: Strategies to Expand Health Insurance for Working Americans." The Commonwealth Fund, December 2001.
6. "Second Class Medicine," Consumer Reports, August 2000.
7. Committee on the Consequences of Uninsurance Board on Health Care Services, Institute of Medicine, Coverage Matters: Insurance and Health Care. National Academy Press, Washington DC, 2001, p. 2.
8. Warren, Elizabeth , Melissa B. Jacoby and Teresa Sullivan. "Medical problems and bankruptcy filings." Norton Bankruptcy Law Advisor, May 2000.
9. "The Conference Board's Consumer Confidence Index Drops Sharply, Largest Monthly Decline Since October 1990," Conference Board News Release, 9/25.01. Available at www.consumerresearchcenter.org/consumer_confidence/index.html.
10. Low- and moderate-income individuals who are unemployed tend to spend any money on necessities, rather than save it. As a result, the targeting of laid-off workers of lesser means will ensure that more money is spent (rather than saved) in the economy, leading to a quicker economic recovery.
11. Davis, Karen, Cathy Schoen, and Stephen C. Schoenbaum, "A 2020 Vision for American Health Care." Archives of Internal Medicine, Vol. 160, No. 22 (December 2000). Available at http://archinte.ama-assn.org/issues/v160v22/ffull/isa00017.html.
12. Zuckerman, op. cit., p. 3.
13. Rice, Thomas, "Subsidizing COBRA: An Option for Expanding Health Insurance Coverage." The Henry J. Kaiser Family Foundation, October 1999.
14. Retsinas, Joan, "COBRA: Legislation and Its Import." Journal of Health and Social Policy, Vol. 10, No. 1 (1998), pp 13-22.
15. Zuckerman, op. cit., p. 2.
16. Gruber, op.cit.
17. Rice, op.cit.
18. Gruber, op.cit.
19. This would be approximately one-quarter of the economic stimulus package passed by the House Ways and Means Committee and a somewhat larger portion of the package advanced by the Administration.
20. The actual average cost will depend on a number of factors, some controlled by Congress and some by employers. These factors include the number of months a subsidy is needed, the percent of premium subsidized, the breakdown between individual and family coverage, and the cost of employer-provided coverage.
21. "Temporary Medicaid Improvements As Part of a Stimulus Package," Center on Budget and Policy Priorities, October 9, 2001.
22. "Statement of Senator Jean Carnahan Re: Senate Vote on Carnahan Amendment to Provide Assistance to Displaced Airline Industry Workers." October 11, 2001. Available at www.senate.gov/~carnahan/press/oct11.htm
23. The cost figures are for 2002.
24. Currently, SSBG programs are expressly prohibited from providing primary medical care and do not have the ability to buy health insurance. These programs therefore are unlikely to be able to construct health care programs that meet the health care needs of laid-off workers. Although states could transfer these monies to the SCHIP and Medicaid programs, this would impose a substantial administrative burden on states that would delay the provision of benefits to workers. For more information, see Park, Edwin and Leighton Ku, "Health Care Provisions of House Ways and Means Committee Stimulus Package Offer Little Help for the Health Insurance Needs of Unemployed Workers." Center for Budget and Policy Priorities, October 16, 2001.