COBRA Subsidy 2009 and Extension Information
- COBRA Premium Subsidy Extended
- What the COBRA Subsidy Means for Employers
- Forms and Notices
- Request for Information forms regarding involuntarily terminated employees
- Useful Links
COBRA Premium Subsidy Extended
December 22, 2009
Congress approved legislation over the weekend extending the federal subsidy of COBRA health insurance premiums. President Barack Obama signed it into law Monday afternoon.
Legislation Details
The extension legislation provides for the following benefits:
- Extends the premium subsidy eligibility period by two months so that it will end on Feb. 28, 2010, rather than Dec. 31, 2009.
- Extends the period of the 65 percent COBRA subsidy from nine months to 15 months.
- Establishes a transition period that applies to individuals who lost subsidies before the effective date of the act because they received the maximum number of months of subsidies under the original subsidy provisions.
- Establishes new notification requirements by group health plans or other entities.
- Clarifies that eligibility and notice requirements for the subsidy are based on eligibility for COBRA due to loss of coverage because of qualifying event (involuntary termination of employment), both of which must occur during the eligibility period.
- Becomes effective as if included in the original COBRA subsidy provisions of the American Recovery and Reinvestment Act (ARRA).
The action allows workers who have used up their original nine months eligibility to receive six more months of the 65 percent subsidy, and those who did not choose to continue with COBRA coverage once they timed out to rejoin the system, pay premiums retroactively and receive the subsidy and maintain COBRA continuation. Workers who are involuntarily terminated through Feb. 28, 2010, can now qualify to begin the subsidy and receive it for 15 months. (It also means that workers terminated after Feb. 28, 2010, will not qualify unless Congress takes further action.)
These new changes in the premium subsidy program will also apply to those who are not eligible for COBRA, but instead are eligible for only state continuation coverage.
NOTE: In New Mexico, established state continuation requirements still apply. For example, duration of coverage will still be limited to up to six months. The extension described above simply adds two months to the qualifying time period to elect state continuation at the subsidized rate.
The original federal subsidy, included as part of the American Recovery and Reinvestment Act, provided a 65 percent premium subsidy starting in March to those who involuntarily lost a job in September 2008 or afterward, and was only scheduled to be available to workers who lost their jobs through the end of this year.
The unemployed who started receiving the subsidy when it was first available in March saw it lapse on December 1, and employees losing their jobs after December 31 were not eligible for the federal help without this Congressional action extending the benefits.
What the COBRA Subsidy Means for Employers
The American Recovery and Reinvestment Act of 2009 signed into law February 17 expands COBRA in many ways. Most significantly, the act offers assistance-eligible individuals a 65 percent subsidy of their required COBRA premiums.
Under the provision, the federal government provides a premium subsidy for up to nine months for workers who lose health coverage as a result of being involuntarily terminated between September 1, 2008, and December 31, 2009, and who are eligible for COBRA coverage benefits, and their dependents.
Forms and Notices
and Request for Information forms regarding involuntarily terminated between employees
Employers will need to provide us with information about all involuntarily terminated employees, by completing and returning the appropriate Request for Information form(s), located below.
Secure E-mail Process
We have created a secure e-mail account to ensure protection of the Sensitive Personal Information (SPI) being transmitted electronically. To begin, send an e-mail to bluecrossblueshield_COBRA@bcbsnm.com. You will receive a special response reply directing you to a Web site, where you will be instructed on how to create a protected account to securely submit information to BCBSNM.
The e-mail you receive will also include the Request for Information form as an attachment. Simply complete the form and return to bluecrossblueshield_COBRA@bcbsnm.com as an attachment, using the same Web site you were directed to in the response e-mail.
Mail or Fax Process
Secure e-mail is the preferred method for providing the requested information. However, if you prefer to mail or fax your records, you may submit the information using the Request for Information forms below for each of your employees. You may mail the form to our COBRA Unit at P.O. Box 1180, Marion, Illinois 62959. Or, fax to us at 618-998-3999.
Request for Information Forms
Useful Links
