Benefits

COBRA FAQ's (American Recovery and Reinvestment Act of 2009)

• What is the effective date of the American Recovery and Reinstatement Act (ARRA)?
• How does the ARRA affect COBRA continuation coverage?
• What is the amount of the COBRA premium subsidy?
• Did I need to elect COBRA coverage when I was first eligible in order to receive the subsidy to my premium?
• How long will I be able to receive the premium subsidy under the new law?
• If I have already paid my March 09 or April 09 COBRA premium, will I get a refund in accordance with the law?
• Will the new legislation extend my 18 month COBRA period?
• If my participation in COBRA started before 9/1/08, will I be able to get a subsidy for the remainder of my COBRA period?
• How will I be notified if I qualify for the premium subsidy?
• If I was eligible for COBRA due to my reduction of hours, will I be eligible for the premium reduction?
• Are there any salary caps to be qualified for the premium subsidy?
• If I had initially elected coverage but was cancelled due to non-payment, am I still eligible to re-elect coverage for the balance of my COBRA?
• If I am eligible for Medicare, will I be still be entitled to a subsidy on my COBRA premiums?
• If I have a pre-existing condition, can I be denied the premium subsidy?

What is the effective date of the American Recovery and Reinstatement Act (ARRA)?

February 17, 2009. Amended March 2, 2010. Amended April  15, 2010.

How does the ARRA affect COBRA continuation coverage?

Under ARRA, employees (and their qualified beneficiaries) who are “involuntarily” terminated from 9/1/08 to 5/31/10 may pay reduced COBRA premiums for a period of up to 15 months.

What is the amount of the COBRA premium subsidy?

65%

Did I need to elect COBRA coverage when I was first eligible in order to receive the subsidy to my premium?

No, if you did not elect coverage when you were first eligible, the County will send you a notice of the new legislation, and you will have another 60 days to elect COBRA coverage under the new legislation.

How long will I be able to receive the premium subsidy under the new law?

You will be able to receive the subsidy for the earliest of a) obtaining eligibility for other group health insurance, b) qualifying for Medicare, or c) for a maximum of 15 months.

If I have already paid my March 09 or April 09 COBRA premium, will I get a refund in accordance with the law?

Yes, if you have already paid the March and/or April premium, you will be credited the difference between the original cost and the subsidy amount.

Will the new legislation extend my 18 month COBRA period?

No. It will not extend your COBRA eligibility period. Your COBRA eligibility period will still be effective as of when you first became eligible for COBRA due to the involuntary termination. This date is usually the end of the pay period in which you were involuntarily terminated, providing premiums were paid.

If my participation in COBRA started before 9/1/08, will I be able to get a subsidy for the remainder of my COBRA period?

No, your COBRA eligibility had to start on or after 9/1/2008.  Anyone whose eligibility began before this date will not have any reduction in the balance of their premiums.

How will I be notified if I qualify for the premium subsidy?

You will be notified by either your health insurance provider or COBRA administrator if you qualify for this subsidy.  A letter will be mailed to you and your covered dependents no later than 60 days after the effective date of the legislation.

If I was eligible for COBRA due to my reduction of hours, will I be eligible for the premium reduction?

No, only those employees who were involuntarily terminated will be eligible for the subsidy under this new law.

Are there any salary caps to be qualified for the premium subsidy?

Yes, the subsidy is phased out if the employee’s adjusted gross income is more than $125,000 (for single filers) and $250,000 for joint filers.

If I had initially elected coverage but was cancelled due to non-payment, am I still eligible to re-elect coverage for the balance of my COBRA?

Yes, even though you were cancelled due to non-payment of premiums, you will be given another opportunity to elect coverage for the balance of your COBRA period.

If I am eligible for Medicare, will I be still be entitled to a subsidy on my COBRA premiums?

No, if you are entitled for Medicare, or are eligible for another group health coverage (such as a spouse’s plan), you are not entitled to the subsidy.

If I have a pre-existing condition, can I be denied the premium subsidy?

No, group health plans cannot impose any pre-existing health condition as a condition for eligibility for the subsidy.

Back to Top Page Last Edited: Tue Jun 14, 2011 3:57:14 PM