December 11, 2009
A Push for Extended, Expanded COBRA Subsidy Program

U.S. Senator Sherrod Brown of Ohio has introduced legislation that would extend and expand the COBRA subsidy program for workers who are involuntary terminated from their jobs.

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Signed into law in February 2009, the American Recovery and Reinvestment Act of 2009 (ARRA) provides for a 65 percent subsidy for COBRA continuation premiums for up to 9 months for workers who have been involuntarily terminated. For workers who became eligible for the program in March 2009, the subsidy ended this month.

Brown's legislation, the COBRA Subsidy Extension and Enhancement Act (S. 2730), would extend the program to provide a total of 15 months of subsidies. The legislation would make other changes as well, such as increasing the subsidy from 65 percent to 75 percent.

Under the original version of the program, the employee's involuntary termination had to occur during the period beginning September 1, 2008 and ending December 31, 2009. Therefore, workers who are involuntarily terminated after December 31, 2009, won't be eligible for the subsidy. The COBRA Subsidy Extension and Enhancement Act would extend that window to June 30, 2010.

The legislation would also extend the subsidy to workers whose hours are reduced to such a degree that they lose eligibility for employer-sponsored health benefits. Currently, only involuntary terminated workers are eligible for the program.


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