The State of the COBRA Subsidy

As health care reform in Washington continues to evolve and take different forms in the House and Senate, my team and I here at Benefit Controls of the Triangle have noticed that many employers (and employees) are unaware of the state of the existing COBRA subsidy under ARRA (American Recovery and Reinvestment Act).

The COBRA Health Insurance Continuation Premium subsidy , signed into law in February of 2009, provides a 65% subsidy of continuing health coverage following employee termination.

As Business Insurance reports, that subsidy provision has a shelf-life ending on December 31st, meaning those people who are laid off after the first of the year will be ineligible for the subsidy.

President Obama openly called for an extension of the program in his speech at the Brookings Institute. Under bills already introduced in the Senate and House, current beneficiaries could receive the subsidy for an additional six months, while employees who lose their jobs from Jan. 1, 2010, through June 30, 2010, could be eligible for subsidized COBRA premiums for up to 15 months.

The Times anticipates that should Congress not renew the COBRA subsidy, it is highly likely the President’s coming jobs bill will include a similar provision. I’d strongly recommend reading this New York Times article – Steps to Take Before Cobra Subsidy Ends – as it provides a number of helpful hints to the unemployed as to how they can avoid seeing their coverage lapse. Employers would be well-served by reading the article as well as it paints a very detailed picture of the landscape.

However, should you find you have additional questions please feel free to contact myself, Sue, or Kim – as always we are happy to address any concerns you may have. I’ll also be sure to update the blog with an as events warrant. In the meantime, take care.

– George


1 Comment

Filed under Health Care Reform, Tools You Can Use

One response to “The State of the COBRA Subsidy

  1. Pingback: COBRA Subsidy May Enjoy 2 More Months of Daylight « Benefit Controls of the Triangle

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