COBRA Benefits Extended

Under the American Recovery and Reinvestment Act of 2009 (ARRA) President Obama recently signed a measure to extend the federal subsidy for continued health insurance coverage for health benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) by 6 months for a total of 15 months. Eligible individuals pay 35% of their COBRA premiums while the remaining 65% is reimbursed to the coverage provider through a tax credit. The federal subsidy is to ease the financial obligation of laid-off workers paying for COBRA benefits.

The federal subsidy applies to coverage on or after February 17, 2009 for up to nine months for those eligible for COBRA during the period beginning September 1, 2008 and ending December 31, 2009 due to a termination of employment that occurred during that period (the subsidy does not apply to those who have quit voluntarily).

Scheduled to expire on December 31, 2009, the subsidy has been extended to workers laid off between January 1 and February 28, 2010, in addition to those laid off between September 1, 2008 and ending December 31, 2009, under the original program.

For more information, visit the U.S. Department of Labor at www.dol.gov/ebsa/COBRA.html.

Please contact Feeley & Driscoll's Accountants and Consultants by Email or call 1 (888) 875-9770 to learn more.

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