NBGH Backs Temporary COBRA Subsidies

A major employer benefits organization said Monday, January 12, that it would back federal COBRA premiums subsidies as long as those subsidies are temporary.

In addition, the Washington-based National Business Group on Health said lawmakers should consider allowing former employees to choose a less expensive plan in which to receive COBRA coverage. Under current law, COBRA beneficiaries must remain in the plan in which they were enrolled until the next open enrollment period.

“With choice, they might pick a plan that has lower premiums and may be a better value,” NBGH president Helen Darling wrote in a letter sent to the chairmen and ranking members of congressional committees with jurisdiction on health care issues, as well as to Tom Daschle, President-elect Barack Obama’s selection as the next secretary of the Department of Health and Human Services.

The NBGH backing of federal COBRA premium subsidies comes as lawmakers are considering whether to include subsidies in an economic stimulus package. Business lobbyists said last week that lawmakers were discussing a proposal in which the government would subsidize 50 to 60 percent of the COBRA premium paid by beneficiaries.

Under law, employers can charge COBRA beneficiaries a premium equal to 102 percent of the cost of coverage offered to employees.

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

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