The American Recovery and Reinvestment Act (ARRA) of 2009 sets forth new mandatory changes for continuing health care coverage under COBRA by temporarily reducing the premium reductions for COBRA and providing additional opportunities to elect COBRA heath care continuation benefits.
Under ARRA, eligible individuals pay only 35% of their COBRA premiums. The remaining 65% is paid by the employer, who then receives reimbursement via a government tax credit.
Eligible employees include any employee who was involuntarily terminated between September 1, 2008 and December 31, 2009 and elects COBRA coverage. Reduction applies to coverage beginning on or after February 17, 2009. Employees who declined COBRA or have since dropped enrollment are eligible for a new election opportunity.
Employers are required to provide notices regarding the premium reduction to individuals who have a qualifying event between eligibility dates of September 1, 2008 and December 31, 2009.
GovDocs COBRA forms, updated for ARRA compliance, and an informational COBRA poster for display along side your labor law posters are now available on our website at www.govdocs.com.
