Congress Considers a Bill to Extend COBRA benefits

Posted by marykeating on December 2, 2009 under Employment benefit issues, Pending legislation | Be the First to Comment

The discussion about health care reform has increased awareness of the high cost of health insurance for people who are not in a group plan.  While employed and in an employer-sponsored plan, an employee usually gets a reasonable plan for a pretty reasonable price, or even free, depending on the employer’s policies.  But then the job ends, whether voluntarily or not.  If the employer has at least 20 employees, the departing employee is entitled to COBRA coverage for 18 months, in most cases.

With unemployment still high, Congress is now thinking about extending the COBRA coverage for six more months, for those people who lost their jobs between April 1 and December 31 of 2009.  In addition, even better for some, the COBRA subsidy discussed here would be extended as well. The subsidy has the federal government picking up 65% of the cost of the premium, which is repaid to the employer by a credit on the payroll taxes.   If passed, the new law will be called the “Extended COBRA Continuation Protection Act of 2009.”

It’s hard to think of an interest group that would oppose this law, other than those who think that the government is subsidizing the unemployed too much.