Laid off workers are continuing to opt for health care coverage under the auspices of the  Consolidated Omnibus Budget Reconciliation Act (COBRA), new analysis by Lincolnshire, Ill.-based Hewitt Associates finds.

Hewitt analyzed COBRA enrollment rates for workers who were voluntarily or involuntarily terminated from their jobs since 2004. For June 2010, the first month after the 65% premium subsidy created by the American Recovery and Reinvestment Act expired, the average COBRA enrollment rate for these employees and their dependents was 21 %. This is only slightly lower than the 25 % enrollment recorded on average when the subsidy was in place.

"With the unemployment rate close to 10 %, more Americans have to turn to COBRA as a way to access health insurance, especially for workers who are involuntarily terminated and either don't have a new job right away, or don't have a job with an employer-provided health plan," says Karen Frost, Hewitt's Health and Welfare Outsourcing leader. "However, enrollment rates will likely decline over time, as workers can't—or aren't willing to—afford the high premiums associated with COBRA coverage. Additionally, workers who enrolled in June anticipating the subsidy would be extended may subsequently drop coverage now that it is clear they won't be able to off-set the high cost of COBRA."

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