COBRA Premium Subsidy To Be Extended? (EUC, employment, apply, average)

[diorgirl]

Reported today by M.P. McQueen in the Wall Street Journal online editon:

With eligibility for a government subsidy for COBRA premiums due to expire Dec. 31, and talk of an extension growing, some laid-off workers are puzzled about what to do next.

The federal program partially subsidizes health-insurance benefits under COBRA (Consolidated Omnibus Budget Reconciliation Act), which allows laid-off workers to pay to continue participating in their former employer's health plan. The subsidy pays for 65% of monthly premiums; former exployees pay 35%.

Only employees who are involuntarily terminated, and not due to gross misconduct, are eligible for the subsidy. People whose employers no longer offer health insurance or went out of business may not be eligible. And there are income restrictions.

A bill [HR 3930] has been introduced in Congress to extend the subsidy for six more months. That would allow eligible individuals to receive the subsidy for as many as 15 months, instead of the current nine months.

The bill also would extend eligibility to workers whose jobs were terminated between January 1 and June 30, 2010. Currently, only people laid off between September 1, 2008, and December 31, 2009, are eligible. In addition, it would allow recipients to stay on Cobra for 24 months, up from the current 18 months.

It's not known if or when the bill would be enacted. But Democratic leaders and the Obama administration have expressed interest, says Rep. Joe Sestak (D., Pa.), the bill's author.

In the meantime, some workers who will lose the subsidy as early as this month must decide whether to try to stay with Cobra despite the loss of the subsidy or seek cheaper insurance elsewhere, experts say.

"For the average laid-off worker, the end of the subsidy means a monthly payment jump from $374 to $1,068 for health insurance," says Phil Lebherz, director and founder of the Foundation for Health Coverage Education, a San Jose, Calif., nonprofit supported by health insurers and foundations. "With an average national unemployment benefit set at $1,278 per month, these participants need to look at other options available."

Mr. Lebherz says there are state and hospital-based programs that can assist with paying Cobra premiums.

Anne Waidmann, a human-resources consultant at PriceWaterhouseCoopers, says participants and their dependents, especially those with pre-existing conditions, should stay on Cobra, for now, if they can afford it.

You can search for health coverage from government-sponsored groups and private, individual plans at coverageforall.org. At ehealth.com, you can comparison shop for private health insurance in many states.

Coverage After Cobra? - WSJ.com

[diorgirl]

US Rep Hoyer: Looking At Further Extension Of Cobra Subsidy

Reported earlier today by Corey Boles of Dow Jones Newswires:

House Democratic leadership is considering another extension of a federal program that subsidizes the cost of health-care insurance for people who have recently lost their jobs, a top Democrat said Tuesday.

House Majority Leader Steny Hoyer, D-Md., said that congressional leaders are looking at a further extension of the program that helps families who lose their health coverage as a result of being laid off.

The vast majority of working-age Americans that have health coverage receive it through their employer, and face the prospect of losing that health care if they lose their job.

The stimulus plan passed by Congress in February included an extension of the duration of the COBRA program, as well as higher subsidies to offset the cost of insurance.

An extension of the COBRA program would be a further attempt by the federal government to help people survive the deepest economic recession since the Great Depression.

Obama administration officials said over the weekend they were considering further stimulative measures in the face of the continuing weak jobs market -- including an extension of COBRA subsidies.

Hoyer said that while he was considering assistance directly targeted at jobless Americans, he didn't want to consider another wider economic stimulus package. The first one needed to be given sufficient opportunity to make its impact felt on the economy, he said.

US Rep Hoyer: Looking At Further Extension Of Cobra Subsidy

[diorgirl]

Bill To Extend COBRA Subsidies Introduced In Senate

Senators introduced legislation Thursday to extend COBRA to help unemployed workers and their families with health coverage. WKYC-TV, a NBC affiliate in Ohio, reports.

"U.S. Sens. Sherrod Brown (D-OH) and Robert P. Casey (D-PA) introduced a bill Thursday to extend the 'COBRA' subsidy which helps unemployed workers and their families afford temporary health care [coverage]. The bill would extend and expand the COBRA subsidy included in the Recovery Act, a subsidy that is set to expire Dec. 1 unless Congress acts to renew it. The bill is also co-sponsored by Sen. Al Franken (D-MN)."

"The American Reinvestment and Recovery Act of 2009 (ARRA) established a nine-month subsidy to help unemployed workers purchase temporary COBRA coverage for themselves and their families. The original COBRA subsidy included in the Recovery Act was based in part on Brown's Coverage Continuity Act (S.29) which he introduced in January 2009."

"The provision in ARRA established a nine-month subsidy to help laid-off workers purchase COBRA coverage -- with the federal government covering 65 percent of the health premium. The goals of this legislation were to ensure coverage continuity and prevent a spike in Medicaid enrollment."

WHTM-TV, an ABC News affiliate in Pennsylvania, reports that the bill would "extend the subsidy an extra six months to 15 months. It would additionally increase the subsidy amount from 65 percent to 75 percent of the workers' premiums.

The extension would also expand eligibility to include workers who lose their employer-sponsored health benefits because of a reduction in working hours. Currently, only laid-off workers are eligible for the subsidy."

Bill To Extend COBRA Subsidies Introduced In Senate - Kaiser Health News

Note: This is the Senate's version of HR 3930, introduced by Rep. Joe Sestak (D., Pa.) in the House last week.

[diorgirl]

From a Q&A column posted November 8, 2009, by the Los Angeles Times online about the timing and effect of HR 3962 [the Affordable Health Care for America Act passed by the House on Saturday evening], on the unemployed:

When would the new healthcare system be fully in place? Are there programs designed to cover people in the meantime?

The proposed insurance exchange, a regulated marketplace, would not be in place until 2013. Medicaid expansion and the payment of premium subsidies to individuals and small employers would also begin in 2013. In the meantime, however, the House bill would create a program providing immediate, temporary coverage for the uninsured.

What are the proposed yearly out-of-pocket limits proposed for plans subsidized by the government?

Yearly out-of-pocket limits for individuals who qualify for subsidized premiums would be capped using a sliding scale based on income. For instance, for an individual who makes $32,490 a year, the cap would be $4,000. For a family of four with an income of $66,150, the cap would be $8,000.

The federal subsidy for COBRA premiums is about to expire. Would this bill do anything to extend that subsidy?

The subsidy that was provided under the American Recovery and Reinvestment Act covers 65% of premium costs for workers who have lost their jobs and want to continue purchasing coverage through their former employers by using COBRA. However, the subsidy ends December 31, 2009.

The House health care bill would allow COBRA customers to keep their policies until a government-regulated insurance exchange is up and running or until affordable alternatives become available.

Some members of the Senate have introduced a separate bill that would extend the subsidy for an extra six months and increase the subsidy amount from 65% of costs to 75%.

New system would be in place in 2013 -- latimes.com

[diorgirl]

In addition to Sestak's bill [HR 3930] proposed in the House and Casey's bill proposed in the Senate, McDermott is now talking about including an extension of the COBRA premium subsidy in the next bill he introduces in the House to extend into 2010 the December 2009 deadlines for UI extensions:

The office of Rep. Jim McDermott (D-Wash.) said Monday that he’ll be pushing a proposal to provide as much as an additional year’s worth of jobless benefits.

The proposal will be wrapped into a package to include other provisions designed to ease Main Street’s pain amid the downturn, including money to subsidize COBRA health benefits, as well as a provision to extend the full federal funding of a traditionally state-federal unemployment insurance program called FedEd [also known as EB], which got full federal funding under the stimulus bill. Without congressional action, states would again have to pick up part of the FedEd tab at the end of 2009.

Jobless Benefits Extension Stiffs High Unemployment States « The Washington Independent

[diorgirl]

Reported earlier to day by Margaret Collins on Bloomberg.com:

The U.S. Congress should extend a health-care subsidy that helps the unemployed before it ends for some recipients this month, Representative Joe Sestak said.

Sestak, a Pennsylvania Democrat, said he’ll send a letter to House Speaker Nancy Pelosi today urging her to act on his bill [HR 3930], which would extend by six months the amount of time fired workers can receive a 65 percent reduction in their monthly premiums through Cobra. The subsidy is set to expire this month for employees who began receiving it when President Barack Obama included the benefit in the economic stimulus plan in February.

U.S. Should Extend Cobra Subsidy Six Months, Congressman Says - Bloomberg.com

[diorgirl]

eHealthInsurance, a leading online source of health insurance for individuals, families, and small businesses, has released an updated set of frequently asked questions (FAQs) for individuals and families whose access to the COBRA subsidy is scheduled to end after November 30, 2009. I have excerpted some of those below.

To read all the FAQs, go to:
COBRA Subsidy Extension: eHealthInsurance Answers the "What If...?" Questions

FAQs Regarding the COBRA Subsidy Expiration

Question: Will the federal COBRA subsidy be extended?
Answer: Congress is considering legislation to extend the COBRA subsidy. However, it is important to note that since COBRA currently only lasts 18 months, COBRA is not a long-term solution.
In the meantime, consumers should explore all of their options, including private health insurance. Searching, applying and qualifying for private health insurance alternatives to COBRA can take time, so consumers whose subsidies may end in the next three months should begin looking now.

Question: What if I just started receiving the COBRA subsidy a month ago -- are my funds going to dry up after November too?
Answer: No. If you qualified for the COBRA subsidy in the first place, the law currently provides that you will continue to receive assistance with your monthly premiums for a total of nine months from the date you started receiving the subsidy.

Question: Is there any risk in applying for private health insurance while I'm still on COBRA?
Answer: Your continued eligibility for COBRA is not affected by applying for a private health insurance plan. Once approved for private coverage, you can simply stop paying your COBRA premiums, and your COBRA coverage will expire. However, if you are denied coverage through a private health insurance plan (due to a pre-existing medical condition, for instance), you can still keep your COBRA coverage until your full 18 months of COBRA runs out.

Question: What if my subsidy funds are running out and I have a pre-existing medical condition?
Answer: If you have a pre-existing medical condition, you should talk to a licensed health insurance agent. Your best option may be to continue COBRA coverage, but an agent can let you know if there are affordable alternatives available.
If you absolutely cannot afford unsubsidized COBRA coverage, check out other government-sponsored options available in your state. The Foundation for Health Coverage Education (FHCE) has an excellent web site and their U.S. Uninsured Help Line can connect you with publicly-funded programs in your state. Their web site is Foundation for Health Coverage Education and their toll-free number is 800-234-1317.

Question: If I drop COBRA, can I re-enroll in COBRA at a later date?
Answer: With regards to the COBRA subsidy, it is unclear if any new legislation will allow for people to return to their COBRA coverage after cancelling it. Generally with COBRA coverage, you can only opt out and opt back in to COBRA within the first 60 days of your eligibility. If you cancel your COBRA coverage after that initial eligibility period, you cannot re-apply for COBRA coverage through the same group plan.
Always check with your COBRA administrator or a licensed health insurance agent before making any final decisions, just so you can be aware of any changes in COBRA benefits.

Question: Isn't this all going to change when health insurance reform legislation is passed?
Answer: If enacted, the proposed health reform legislation will not be implemented overnight. In fact, many of the health insurance reforms in the draft legislation are not expected to take effect until 2013.

[diorgirl]

According to today's edition of The Hill.com, Democrats hope to pass jobs legislation through the House before lawmakers leave for Christmas on Dec. 18, House Majority Leader Steny Hoyer said Tuesday.

Hoyer declined to give a dollar figure for what Democrats are planning, but he said he expects Democrats will at a minimum extend unemployment benefits and COBRA health insurance assistance for the unemployed.

House Speaker Nancy Pelosi (D-Calif.) has asked key committee chairmen for ideas on job creation, which Hoyer (D-Md.) said could be wrapped into one bill.

“It's my hope we will adjourn by Dec. 18,” Hoyer said in his weekly session with reporters. “I would certainly hope we would move something on jobs before that.”

Hoyer last week told lawmakers that the House could stay in session on Dec. 21 and 22, if necessary, to work on healthcare reform and other issues.

Hoyer: Democrats are set to move jobs legislation by Christmas - TheHill.com

[fishindagulf]

Originally Posted by annerk

Does anyone know if there is a tax credit for these COBRA subsidies to the companies being forced to offer them?

Yes companies do recieve a tax credit which would make it very affordable if not at first than at the end of the fiscal year for participation in the ARRA program, my family is currently working off one income instead of the usual three and my father is currently using the ARRA program which is going to run out next month (he was laid off December 23rd of last year) we are hoping the house and senate can create an extension of benefits to cover the full 18 month COBRA coverage.

[NJDevil]

H.R. 3930: Extended COBRA Continuation Protection Act of 2009 (GovTrack.us)

The bill was was referred to committees on 10/26. Apparently nothing has happened since then? I emailed Rep. Sestak's office but have not heard back. How can we find out what's happening with this bill, since it says "most never make it out of committee" ??

My subsidy will end on 11/30, so if they have until 12/30 to pass something - would I be reinstated? Because I am not going to pay for COBRA next month - almost $400.