On April 15, 2010, Congress approved another short term extension for COBRA health insurance premium subsidy for jobless Americans.
The Continuing Extension Act of 2010, which extends the COBRA subsidy provided under the federal stimulus bill, includes employees involuntarily terminated between April 1 and May 31, 2010. The 65% subsidy continues to be available for qualifying individuals for a maximum period of up to 15 months.
At a minimum, employers should expect that they will be required to provide updated notices to individuals in the following two groups:
1. Employees who were involuntarily terminated since April 1, 2010. It appears this notice will permit a retroactive election and a 60-day period within which to elect coverage.
2. Individuals who experience a qualifying event (of any type) on or after April 1, 2010 but prior to May 31, 2010.
The DOL has acted quickly in the past to provide updated model notices. BRG anticipates they may provide updated notices and related guidance in the next few weeks.
There is additional legislation in Congress, The American Workers, State, and Business Relief Act of 2010, that will potentially extend the subsidy through the end of 2010. We will provide more information on any future extensions and the impact on employers as the legislation develops.
If you have any questions, please contact Cindy LaQuatra at 216-393-1848 or by email at claquatra@benefitsrg.com .
As a health insurance agent I've seen the COBRA Subsidy help many individuals and families that have been laid off as a result of the recession. As an employee benefits broker I've seen the same subsidy wreak havoc on cash flow for already struggling companies. This game of on again off again really does little to help anyone. Unless COBRA is the only option and/or a significant savings we typically recommend that our clients look at an individual health insurance plan.
ReplyDeleteDennis Carlson
www.bespokebenefits.com
www.insuranceninja.com