Health Insurance Subsidy for Employees Expands

The federal government has extended the subsidy for health insurance expenses for employees who are involuntarily separated from their jobs. The law, which was enacted in February 2009 as part of President Obama’s Recovery Act, now requires employers to pay 65% of health insurance continuation costs for employees they terminate prior to February 28, 2010. It  provides up to 15 months worth of this benefit, an expansion of the 9 months provided by the bill in early 2009.

The bill still is aimed solely at helping workers and does not require employers to foot any additional health insurance expense. Though businesses may initially lay out the 65% subsidy, they quickly recoup it via a credit against their payroll tax filings. The original statute provided the health insurance subsidy only to workers who were fired prior to December 31, 2009. Information on the law, which is administered by the U.S. Department of Labor, is available at

COBRA Law Benefits Expanded

It’s commonly known as the “Stimulus Bill,” and is officially called the American Recovery and Reinvestment Act of 2009. This is the huge federal bill passed in February at the urging of President Barack Obama. While the overall idea was to stimulate the American economy, included in the bill’s details are unexpected benefits like the one that laid off employees will enjoy under COBRA. As most know, this federal law guarantees continued health care coverage for workers who lose their jobs, regardless of the reason. Under the Stimulus Bill, employers now must cover 65% of the COBRA premium for employees fired – or laid off, if that term is preferred, the distinction being meaningless in this context – between September 1, 2008 and December 31, 2009. This percentage must be paid for up to nine months, but applies only to periods of time between [Read more…]