Finding an Affordable Alternative to COBRA


Losing your job can be a stressful experience, especially if you are losing your employer-provided health coverage. For many, the obvious solution is to enroll in COBRA, a federal law and health insurance program that allows employees to extend their coverage for a limited time. It is a temporary option that helps bridge the gap until you find a new job and its benefits package.

However, COBRA can be quite expensive as you would have to pay for the full coverage, including what your employer used to contribute. Luckily, there is an alternative option that may be better suited for your budget and timeline: short-term medical insurance.

Understanding COBRA

COBRA is an acronym for the Consolidated Omnibus Budget Reconciliation Act of 1985. This federal law requires most employers to offer their employees and their eligible dependents the option to continue group health insurance coverage under certain circumstances.

This could be due to things such as when a person loses or change jobs. It can also be due to retiring or suffering a reduction in work hours.

The main benefit of COBRA is that it allows you to maintain your current health coverage. But as we previously mentioned, this comes at a huge cost. Which is the last thing people need when they are in between jobs.

According to a report by the Kaiser Family Foundation, the average premium cost for health insurance was $7,470 for an individual and $21,342 for the whole family. Which normally 83% of that would be covered by the employer. monthly cost of COBRA is $599 per individual and $1,715 per family.

But with COBRA insurance, you’re on the hook for the whole thing. In contrast, short-term medical insurance plans are more affordable, with premiums starting as low as $100 per month, depending on your coverage level and the state that you live in.

What Is a Short-Term Health Insurance Plan?

Short-term health insurance plans are designed to provide temporary coverage for people who need health insurance for a limited time. These plans typically offer customizable coverage options, with different deductibles and coinsurance levels to choose from. Short-term plans can be an excellent alternative to COBRA if you only need coverage for a few months, as they are typically more affordable and offer quick approvals.

How Do Short-Term Health Plans Work?

Short-term health plans are relatively simple to understand. You choose a plan that fits your situation and budget, and your coverage begins almost immediately. You pay an affordable monthly premium, and your plan provides you with coverage for things like doctor’s visits, hospitalization, and prescription drugs.

While they are not as comprehensive as major medical health insurance plans, short-term medical insurance plans can provide you with the basic coverage you need to stay healthy and protected during your employment transition.

Short-term plans are designed to be flexible, offering coverage terms that range from 30 days to 364 days, depending on your needs.

Short-term medical insurance plans also offer a great deal of flexibility. Unlike COBRA, which limits you to open and special enrollment periods, you can apply for short-term medical insurance at any time and start coverage almost immediately.

This means that if you find yourself in between jobs with a temporary gap in coverage, you can quickly apply and get approved without having to worry about waiting periods.

Are There Any Restrictions on Short-Term Health Plans?

Short-term health plans do have some limitations. They typically don’t cover pre-existing conditions or mental health.

What Are the Benefits of Short-Term Medical Insurance?

The main benefit of a short-term medical insurance plan is affordability. Premiums for these plans are typically much lower than those offered by COBRA, and you can often find plans with deductibles and coinsurance levels that fit your budget.

With that being said, there are other benefits to short-term health insurance plans:

  • Is more affordable than COBRA
  • Customizable plans
  • Quick approvals
  • No open/special enrollments
  • Provides plenty of coverage
  • Flexible terms that range from 30 days to 364 days

Who Is Short-Term Medical Insurance For?

There are several groups that can benefit from short-term medical insurance plans:

Young Adults

This type of insurance is ideal for young adults who are coming off their parents’ insurance, or for those who have just graduated from college and are waiting for employer benefits to start.


Retirees who are under 65 and in good health but not yet eligible for Medicare can also benefit from Short-Term Medical Insurance.

People In Need of Catastrophic Coverage

Anyone in good health who desires short-term catastrophic coverage in the event of an unexpected illness or accident may consider this type of insurance.

People Who Need A Cheaper Alternative to COBRA

For those in between jobs who don’t want to pay the high cost of COBRA, short-term medical insurance is an attractive alternative.

People Waiting For Their Benefits to Start

Short-term medical insurance can provide coverage for individuals who have just started a new job and are waiting for their employer’s health benefits to kick in.

If you fall into one of these groups, then it’s likely that short term medical insurance is right for you.

Is Short-Term Medical Insurance Right for You?

If you are looking for affordable health insurance coverage after losing your job, short-term health insurance may be an excellent alternative to COBRA.

While short-term health plans may not be right for everyone, they are an affordable and flexible insurance option to consider. Be sure to weigh your options carefully and choose the coverage that best fits your needs and budget.

At SGIC Insurance, we understand the uncertainty and financial challenges that come with job transition periods. Our mission is to provide you with affordable, flexible, and timely insurance solutions that fit your unique needs, thereby easing your stress during such times.

Our short-term medical insurance plans offer a compelling alternative to COBRA, specifically designed to offer temporary coverage until you find stable employment. While it’s crucial to take time to weigh your options and determine what fits your needs and budget best, know that SGIC Insurance stands ready to support you during life’s unplanned disruptions.

Contact us today for a quote and to explore your short-term medical insurance options. No matter what your situation is, we’ll work with you to find the best plan to fit your needs and give you peace of mind. Let us help protect you during this transition period.