COBRA Subsidy Extended

» Articles » Legal Articles » Article

January 07, 2010

The extension of the COBRA health insurance subsidy, signed into law by President Obama on December 21st after an 88-10 vote by the Senate, will provide additional relief for a record number of unemployed workers.

Congress passed legislation last week that will provide additional assistance to individuals who have lost their jobs and have opted to continue their former employer's health benefits under the Consolidated Omnibus Budget Reconciliation Act (COBRA). The measure extends the 65 percent federal subsidy for COBRA established by the American Recovery and Reinvestment Act (ARRA) in February of this year. The subsidy previously applied only to employees who lose their jobs before December 31. The extension will allow employees who are involuntary terminated through February 28, 2010 to take advantage of the subsidy program.

Notably, the extension also adds six months of subsidies to the previous nine-month period, for a maximum of 15 months. In addition, the legislation allows COBRA beneficiaries whose subsidies expired under the original program, and who failed to pay the full premium thereafter, the opportunity to receive retroactive COBRA coverage upon payment of the subsidized amount, or 35 percent.

Employers are required to notify current and future COBRA beneficiaries of the extended subsidy provided by the new legislation.

Continue reading below

FREE Legal Training from Lorman

Lorman has over 35 years of professional training experience.
Join us for a special white paper and level up your Legal knowledge!

Litigation or Legal Holds for Reasonably Anticipated or Actual Litigation
Presented by John E. Delaney

Learn More

Nancy B. Sasser
[email protected]
view bio

The material appearing in this web site is for informational purposes only and is not legal advice. Transmission of this information is not intended to create, and receipt does not constitute, an attorney-client relationship. The information provided herein is intended only as general information which may or may not reflect the most current developments. Although these materials may be prepared by professionals, they should not be used as a substitute for professional services. If legal or other professional advice is required, the services of a professional should be sought.

The opinions or viewpoints expressed herein do not necessarily reflect those of Lorman Education Services. All materials and content were prepared by persons and/or entities other than Lorman Education Services, and said other persons and/or entities are solely responsible for their content.

Any links to other web sites are not intended to be referrals or endorsements of these sites. The links provided are maintained by the respective organizations, and they are solely responsible for the content of their own sites.