Most people probably wouldn’t associate a $700 billion-plus economic recovery bill with the plight of former employees who need to make hefty health insurance payments. Then again, most people don’t think like members of the U.S. Congress. Among the many lesser publicized aspects of the latest mega-bill, passed in February 2009, is a requirement that employers who fire employees between September 1, 2008 and December 31, 2009 pay 65% of their former workers’ health care costs under COBRA for a period of up to nine months.
The benefits payments don’t kick in until February 17, 2009, but workers let go before that date can still enjoy coverage. Under the new law, employers must make the payments first and recoup them through tax credits at year end. COBRA is the federal law that provides for continued health care coverage to employees who lose their jobs, regardless of the reason for separation. Under the 2009 bill, the 65% benefit also applies [Read more…]