COBRA Subsidy Receives 31-Day Extension
The COBRA subsidy has been a lifeline for many displaced workers laid off due to the financial crisis; luckily it received a 31-day extension to offer benefits to additional workers. The health insurance subsidy, which allows people to continue receive health insurance from their previous employers has been in danger of expiring many times in the past months.
About the Subsidy
COBRA (TheConsolidated Omnibus BudgetReconciliation Act of 1985) is a law that allows people to continue health coverage from their employers for up to 18 months. However, after the financial crisis occurred at the end of 2008, many workers could not afford the often expensive coverage.
To assist displaced workers, the government offered a subsidy of 65 percent to make coverage more affordable. In addition, the governmentstretched outthe number of months that employees could take advantage of this extended health insurance plan.
About the Latest Extension
The most recent extension of theCOBRA subsidy includes workers who were laid off from March 1 through March 31. Without this extension, employees who were laid off after Feb. 28 would have been ineligible for the subsidy. Also, it will allow employees to receive the subsidy if they first lost their group coverage as a result of a reduction in hours and then were terminated after enactment of the legislation.
With this extension expiring in a few short weeks, the Senate is continuing to look at ways to revamp the current legislation so that it will help more workers affected by financial crisis layoffs. If all goes well, theCOBRA subsidy will be extended to workers who have been laid off all the way through Dec. 31, 2010.
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