Cobra Premiums Reduced by “American Recovery And Reinvestment Act”
Congress has passed the “American Recovery and Reinvestment Act of 2009” which was signed into law by President Obama. This act includes a 65 percent subsidy on the cost of Cobra premiums for nine months. The Cobra recipient will only pay 35 percent of the overall Cobra premium for that period.
The coverage expires on the earlier of the date the individual becomes eligible for major medical employer-sponsored coverage or Medicare, nine months, or the end of the maximum required period of Cobra continuation.
The Cobra subsidy is available, if:
*You were layed off between September 1, 2008 and December 31, 2009; and
*At the time of your layoff, you were covered by a group policy provided by your employer; and
*Your annual income is less than $125,000 or your annual family income is less than $250,000; and
*Your prior employer must still be actively in business.
This subsidy is not retroactive and will only apply from the date of the law’s passage. If you are already enrolled in Cobra, and began paying premiums before the Act effective date, you will not receive a credit for the Cobra premiums you paid prior to the effective date.
However, if you were layed off on or after September 1, 2008 and did not Select Cobra within the 62-day window, you are allowed to become eligible for Cobra again, as long as your former employer still exists and offers group coverage.
Despite the 65% subsidy, it is still very possible that Cobra’s rate will be substantially higher than an Ohio individual health insurance plan. And, of course, the Cobra subsidy only lasts for nine months, leaving open the possibility that a chronic health condition could occur, thus, making it more difficult to qualify for an individual or family health insurance policy.
Additional Cobra details can be found from the United States Department of Labor.
If your Cobra coverage is close to ending, we’ll find an affordable Ohio health insurance plan to meet your needs. For an instant quote where you can view and compare your options, please click on the “Get Instant Quote” button at the top of the page.
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The ARRA to me is a good step in the right direction. We need someone to step in a make a move. Despite the restrictions on who this applies to it will still come in handy for many that need the assistance.
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It sounds like you’re creating problems yourself by trying to solve this issue instead of looking at why there is a problem in the first place.
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