Legal

House Passes Stopgap COBRA Subsidy Extension

By Staff Report

Mar. 17, 2010

Federal COBRA health insurance premium subsidies would be extended temporarily once again under legislation approved Wednesday, March 17, by the House of Representatives.


Under the bill, H.R. 4851, proposed Tuesday by Ways and Means Committee Chairman Sander Levin, D-Michigan, and approved by the House on a voice vote, the 15-month, 65 percent federal premium subsidy would be extended to employees involuntarily terminated from April 1-30.


Without an extension, employees laid off after March 31 would not be eligible for the subsidy.


As part of a broader bill, H.R. 4213, the Senate last week approved a longer extension to enable employees laid off through the end of the year to receive the subsidy, but the House has yet to take up that measure because of funding concerns about certain provisions in the bill, observers say.


The latest stopgap extension would continue the politically popular subsidy for newly laid-off employees and allow Congress more time to try to reach agreement on the broader bill with the longer extension.


“There is no doubt in my mind that, through one way or another, the subsidy will be extended through the end of the year,” said Frank McArdle, a consultant with Hewitt Associates Inc. in Washington.


Earlier this month, legislators approved and President Barack Obama signed into law a 31-day extension to ensure that employees laid off from March 1-31 would be eligible for the subsidy.


Filed by Jerry Geisel of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.


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