Home -> Law Blog Directory -> Labor & Employment Law Blogs -> New York Public Personnel Law

Labor & Employment Law

: New York Public Personnel Law

Federal assistance for the continuation of employer-provided health insurance under COBRA in the event of a layoff extended

Federal assistance for the continuation of employer-provided health insurance under COBRA in the event of a layoff extended
Source: Employee Benefits Security Administration

If an individual or a family member has lost employment, the American Recovery and Reinvestment Act of 2009 (ARRA) may make it possible for the individual or family member to keep employment-related health coverage by providing financial assistance to eligible individuals.

The Act provides for premium assistance for health benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985, commonly called COBRA.

The premium assistance is also available for continuation coverage under certain State laws.

For coverage periods beginning on or after February 17, 2009, assistance eligible individuals pay only 35% of their continuation coverage premiums to the plan for the first fifteen months. The remaining 65% is reimbursed to the plan, employer, or health insurance issuer through a payroll tax credit.*

The Department of Defense Appropriations Act, 2010 (2010 DOD Act) extended the eligibility period for the COBRA premium reduction from December 31, 2009 to February 28, 2010 and the maximum period for receiving the subsidy from nine to fifteen months.

To be considered an "Assistance Eligible Individual" and receive reduced premiums the applicant must satisfy all of the following requirements:

1. Must have a continuation coverage election opportunity related to an involuntary termination of employment that occurred at any time from September 1, 2008 through February 28, 2010;

2. Must elect the coverage (within the appropriate timeframes);

3. Must NOT be eligible for Medicare; AND

4. Must NOT be eligible for coverage under any other group health plan, such as a plan sponsored by a successor employer or a spouse's employer.

Additional information and application forms are available at the Employee Benefits Security Administration?s web site at http://www.dol.gov/ebsa/COBRA/main.html

* Click on An Employer's Guide to Health Continuation Coverage Under COBRA for information concerning ?payroll tax credit.?

Full post as published by New York Public Personnel Law on February 18, 2010 (boomark / email).