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COBRA Changes Under Stimulus Bill

6 Things About COBRA Under the New Stimulus

As if having to search for a new job after a layoff isn't enough stress, jobless workers must consider how they'll get health care coverage without their old employers' plans. COBRA, short for the Consolidated Omnibus Budget Reconciliation Act passed by Congress in 1986, requires most group health care plans to provide a temporary continuation of coverage that an employee would typically lose after termination.

The downside to COBRA has been cost, but the American Recovery and Reinvestment Act of 2009 calls for a 65 percent subsidy toward group health insurance premiums for laid-off employees. Here are six facts about the COBRA subsidy under the stimulus plan.

  1. The subsidy only lasts for nine months.
  2. You're eligible if you were laid off between Sept. 1, 2008 and Dec. 31, 2009.
  3. To qualify for the subsidy, individuals must make less than $125,000 and families can't earn more than $250,000.
  4. You are not eligible for the subsidy if your employer went out of business.
  5. If you’ve already made COBRA payments, there's no provision for a retroactive credit for the previous payments.
  6. If you missed your 62-day window for signing up for COBRA coverage (but were laid of in the eligible time period), the door is open for you to sign up again.

Are you currently paying for COBRA coverage?


Join The Conversation
kscincotta kscincotta 8 years
We will be. My husband just left his old job and is getting COBRA coverage for a few months until his new coverage kicks in at the new company. I think. I'm actually a little confused on it, so this was a helpful post.
Smart-Living Smart-Living 8 years
aimeeb- Why does it depress you? It's good news that more laid off workers could afford COBRA coverage than before.
aimeeb aimeeb 8 years
This depresses me...
ilanac13 ilanac13 8 years
i used to tell my fiance that he NEEDED to pay for cobra since it's something that you should have coverage for but he didn't have the $$ to do so. i think that with the new stimulus, there's a lot of gray area. think about all of the people that lost their jobs because companies went out of they are kind of out of luck since they don't get the benefits
plaidpaisley20 plaidpaisley20 8 years
My parents are currently paying for my COBRA...nearly $500 per month. I feel like I should "accidentally" break a bone or sprain something to make it worth it, otherwise it feels like they are spending all that money for nothing.
HaterTot HaterTot 8 years
Was laid off, but wasn't eligible for COBRA because my organization had less than 15 employees.
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