On March 2, 2010, President Obama signed the Temporary Extension Act of 2010 into law. This bill, which applies retroactively, extended the COBRA subsidy for individuals who lose group health coverage due to an involuntary termination that occurs up to and including March 31, 2010. The previous cut-off date was February 28, 2010.
In addition to the subsidy extension, the bill also includes a provision that allows certain employees who initially lost group health coverage due to a reduction in hours and were later terminated to receive the subsidy. The New York Labor & Employment Law Report recently covered this change in detail in: COBRA Subsidy Available for Reduction in Hours Followed by Involuntary Termination.
Congress is currently considering additional legislation that would extend the COBRA premium subsidy even longer. The House is considering the Jobs for Main Street Act, which would extend the subsidy through June 30, 2010. The Senate is considering the American Workers, State, and Business Relief Act of 2010, which would extend the subsidy through December 31, 2010.
Employers should monitor these bills closely to ensure compliance with all COBRA notice, premium subsidy, and related requirements.