NEWS - Feds will help with COBRA payments

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Dayton Business Journal

Thursday, February 26, 2009, 5:33pm EST

Feds will help with COBRA payments

The federal government will subsidize 65 percent of the cost of health

insurance through COBRA for workers who lost their jobs between Sept.

1, 2008 and Dec. 31, 2009.

The provision was included in the economic stimulus package signed

into law Feb. 17. The Consolidated Omnibus Budget Reconciliation Act,

enacted in 1985, currently allows individuals to retain their company

insurance coverage for up to 18 months after they leave their

employer. Individuals who elect COBRA coverage pay both the employee’s

and the employer’s share of the premiums, plus a 2 percent

administrative charge.

Business groups are relieved the final stimulus bill didn’t include a

broader expansion of COBRA. The original House bill would have allowed

former employees who are 55 or older, or who have been with a company

for 10 years, to receive health coverage through COBRA until they are

eligible for Medicare at 65.

Business groups said covering this age group through COBRA would have

cost employers more than what the former employees would have paid for

it, especially since individuals 55 and over tend to have more serious

health issues than younger workers.

For more information about COBRA, see

www.dol.gov/dol/topic/health-plans/cobra.htm.

http://www.bizjournals.com/dayton/stories/2009/02/23/daily54.html

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