SAN FRANCISCO (MarketWatch) -- Just a few months after passing comprehensive health reform, U.S. lawmakers appear willing to risk a short-term backslide in the push to reduce the number of uninsured Americans until the overhaul's major provisions take effect in 2014.

Unless Congress passes an extension retroactively, people who lose their jobs on or after June 1 no longer will receive government financial help to cover 65% of their premium costs for Cobra health coverage, which lets them continue on their former employer's group health plan.

The U.S. House of Representatives stripped out of a recent jobs bill a provision that would have extended the Cobra payment subsidy. That bill now heads to the Senate. See story on House extends jobless benefits, tax breaks.

If lawmakers choose not to extend the Cobra subsidy, the only people who could claim those subsidies for 15 months are those who were laid off between Sept. 2008 and May 31, 2010.

Cobra coverage requires former employees to pay full freight for their health insurance, meaning the entire cost of the premium plus an administrative fee of up to 2%. In exchange, they're allowed to keep their comprehensive benefits and the network of doctors and hospitals to which they're accustomed.

Monthly family premiums for Cobra coverage run $387 on average with the help of the subsidy made possible by the 2009 economic stimulus package, according to a new study from Families USA, a health-care advocacy group in Washington. Without the subsidy, family premiums will jump to an average $1,107 a month. The government has been picking up the difference of about $720 a month for eligible people.

Without that financial help, many jobless workers may be surprised to find out how much of their unemployment insurance checks are gobbled up by Cobra premiums. Those who are newly laid off and don't qualify for the subsidy will have to spend 84% of their monthly unemployment insurance checks on Cobra premiums to keep their families insured, Families USA found.

The average monthly unemployment income is $1,313 compared with an average charge of $1,107 for Cobra coverage, according to the report. The average cost of Cobra without government financial aid exceeds the average income from jobless benefits in 11 states.

"It's ironic that in a little over two months after health reform passed and is designed to achieve significant coverage improvement, in the short term we will go backwards," said Ron Pollack, executive director of Families USA.

Shopping on your own

People who lose their jobs after June 1 may be able to find coverage on the individual market if they can afford it and they don't have a preexisting condition that disqualifies them, said Edwin Park, co-director for health policy at the Center on Budget and Policy Priorities in Washington. Under the new health-reform law, health insurers will be banned from discriminating against people with preexisting conditions, but that provision doesn't kick in until 2014. A transition program that patches together a network of high-risk pools for the medically uninsurable is still in the planning stages.

"Cobra coverage is so expensive, but the alternatives are either going without coverage or having to go to the individual market," Park said. "As long as there's not a gap of 63 days or more in coverage, you're guaranteed access to the individual market so insurers can't deny you. But it may not provide the same comprehensive benefits."

Ron Antonette, 41, a self-employed public-relations professional in Long Beach, Calif., knows how the uncertainty of government subsidies can change a family's personal finances. He elected Cobra coverage for most of 2009 after losing a job. He estimates the government subsidy saved his family of four $800 to $1,000 a month.

"I ended in advance of when the subsidy was going to run out," he said of the last time Congress weighed extending the subsidy. "I didn't want to be committed for the whole year, and we weren't going to be able to afford the 65% increase. By moving to our own health insurance, we actually reduced our costs considerably.

"This is our first experience of actually having to shop for health insurance," he said, noting that he chose a high-deductible plan after working with a broker and feels lucky his family doesn't have any preexisting health conditions. "If you have medical conditions you may have to stay with what you have."

Where to find coverage

Adults who can't find coverage on the individual market may be able to get health care on a sliding-fee scale at community health centers, and families may be able to enroll their children in the state children's health insurance program, Pollack said.

At the same time Congress grapples with extending Cobra assistance, it also has the chance to extend financial relief for state Medicaid programs, which would preserve benefits for low-income people in need of health care.

Unless Congress acts, "it means states left and right are going to be cutting back Medicaid services," Pollack said. That could mean reduced benefits, increased cost-sharing for beneficiaries or lower reimbursement for health-care providers that accept Medicaid patients.

In the meantime, hope that employers will begin hiring in earnest again remains tepid. The national unemployment rate fell to 9.7% in May from 9.9% in April, a move that mostly reflects the addition of temporary Census workers, the U.S. Labor Department reported Friday. See story on hiring weak in May except for Census workers.

The prospects for more continuous health coverage look rosier in 2014, when Medicaid expansion and new health-insurance exchanges that offer subsidies to low- and moderate-income people to buy coverage are slated to get off the ground, Park said.

"Employer-based coverage will still be the predominant source of coverage," he said," "but when people lose their jobs and health insurance they'll have affordable alternatives that they don't have now."