This law affects groups and how your health plan coverage is administered.
May 2010
The American Recovery and Reinvestment Act (ARRA), passed on February 17, 2009, originally provided that involuntarily terminated employees may receive a COBRA premium subsidy of 65 percent for up to 9 months. Employees involuntarily terminated between September 1, 2008, and December 31, 2009 and otherwise eligible for COBRA were receive this subsidy. See Federal COBRA for Groups with 20 or more employees.
On December 19, 2009, ARRA was amended to extend the Federal COBRA subsidy to individuals who are involuntarily terminated from employment on or before February 28, 2010. Unlike the original subsidy provisions, the loss of coverage was not required to occur on or before February 28. The subsidy period was also extended to a total of 15 months. The amendment also provided that certain individuals who exhausted 9 months of the original subsidy may be eligible for further subsidy payments.
ARRA has been amended again to provide that involuntarily terminated employees may receive COBRA premium subsidy of 65 percent for up to 15 months. Employees involuntarily terminated between September 1, 20008 and March 31, 2010 and otherwise eligible for COBRA may receive this subsidy. In addition, employees who experienced a loss of coverage due to a reduction in hours that occurred between September 1, 2008 and May 31, 2010 and experience an involuntary termination between March 2, 2010 and May 31, 2010 are also eligible for the subsidy.
For additional information and communication tools, go to the Department of Labor website at http://www.dol.gov/COBRA.
Bookmark this page to check back for new development and further guidance on regulations of these laws.
You can also visit the Employee Benefits Security Administration section of the DOL website for their latest updates. Visit www.dol.gov/ebsa/COBRA.html.
The IRS web page with details on the subsidy can be found by going here: www.irs.gov/newsroom/article/0,,id=204505,00.html.