Current law provides subsidies only to those who are involuntary terminated and lose health insurance coverage by December 31, 2010. Proposed in the defense spending bill are provisions that would extend the 65% subsidy to 15 months and would be offered to those who become eligible by February 28, 2010. Other provisions of the bill include:
- Clarification that only the date of the qualified event relating to the COBRA coverage (e.g. the involuntary termination of employment) will determine eligibility for the COBRA subsidy - and not the date the individual becomes covered by COBRA
- An opportunity for those individuals who lost eligibility for the subsidy (i.e. when the subsidy expired on November 1, 2009) and then lost COBRA coverage due to non-payment of premiums, to retroactively continue COBRA coverage and the subsidy by paying the premium within the later of 60 days from the date of enactment, or 30 days from notification. This also extends to those individuals who lost eligibility for the subsidy but retained their COBRA coverage by paying the full premium
- New and updated notification requirements, including providing a notification within 60 days of enactment that describes the new subsidy provisions to those individuals who were assistance eligible individuals (AEIs) or became AEIs on or after October 31, 2009. In the case of a qualifying event that occurs after enactment, this notice will be provided as part of the COBRA election notice
- Treating the new requirements as having been included as part of the original language contained in the American Recovery and Reinvestment Act of 2009.
The text of the bill can be read on the House Appropriations Commitee website at http://appropriations.house.gov/.
Source: USI Insurance, Littler Mendelson "Washington DC Employment Law Update"
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