Congress extends COBRA congress 2010-01-11

The American Recovery and Reinvestment Act of 2009 (ARRA) provided premium subsidy and additional election opportunities for health benefi ts under COBRA through December 31, 2009. Eligible individuals pay only 35 percent of their COBRA premiums and the remaining 65 percent is reimbursed to the coverage provider through a tax credit. Last week congress passed a bill that includes provisions extending the eligibility period for the COBRA premium subsidy through February 28, 2010. It also extends the maximum duration of assistance from nine months to 15 months. Lawmakers also set the stage for another subsidy extension sometime in the future by making it part of the upcoming Jobs bill. Highlights of the new provision include: • The end date of eligibility for the ARRA subsidy Changes from Dec. 31, 2009, to Feb. 28, 2010 • The ARRA premium subsidy expands to 15 months, increased from original nine months • Those who have lost their subsidy by completing their nine months in November or later would be grandfathered in under the new legislation • Involuntary terminations that occur on or before Feb. 28, 2010, would be eligible for the subsidy, regardless of when the individual’s COBRA period begins. • Special notices are required to notify eligible individuals about the expansion to 15 months.