On April 15, President Obama signed into law the Continuing Extension Act of 2010 (H.R. 4851), which, in addition to extending unemployment benefits, includes a stopgap extension of eligibility for the COBRA subsidies that were originally part of the American Recovery and Reinvestment Act of 2009 (ARRA).1
Extension of Eligibility Period
The eligibility period for the ARRA COBRA subsidy ended on March 31, 2010. The legislation extends the eligibility period retroactively from April 1, 2010 through May 31, 2010. The legislation makes no other changes to the ARRA COBRA subsidies.
If any employees have been involuntarily terminated since April 1 and have received COBRA notices without the ARRA COBRA subsidy information, a supplemental notice containing the ARRA COBRA subsidy information will need to be provided to those affected individuals.
This stopgap extension is designed both to provide continued coverage under this popular benefit, and to give the House and Senate time to attempt to reconcile larger jobs bills, H.R. 2847, Jobs for Main Street Act of 2010, that passed the U.S. House of Representatives in December 2009 (the House bill) and H.R. 4213, the American Workers, State, and Business Relief Act of 2010, that passed the U.S. Senate in March 2010 (the Senate bill).
Both bills contain further extensions of the ARRA COBRA subsidy. The House bill (which was passed before the three most recent stopgap extensions) would extend the eligibility for the subsidy to employees who are involuntarily terminated on or before June 30, 2010. The Senate bill would extend the eligibility for the subsidy to employees who are involuntarily terminated on or before December 31, 2010. The Senate bill also contains certain pension funding relief provisions which are not contained in the House bill. In connection with signing the current stopgap extension, President Obama urged Congress to extend the COBRA subsidy eligibility through December 31, 2010.
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1 The original ARRA COBRA subsidies were discussed in the Vedder Price Employee Benefits Briefings dated February 17, 2009
www.vedderprice.com/Benefits0209/, March 25, 2009 www.vedderprice.com/Benefits0309/ and April 3, 2009 www.vedderprice.com/Benefits0409/. The extension of the eligibility and coverage periods under the Department of Defense Appropriations Act, 2010 (H.R. 3326) was discussed in the Vedder Price Employee Benefits Briefings dated December 19, 2009 www.vedderprice.com/Benefits1209/, January 15, 2010 www.vedderprice.com/Benefits0110/ and March 3, 2010 www.vedderprice.com/Benefits0310/
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