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COBRA and the Economic Stimulus

On Tuesday, February 14, 2009, President Barack Obama signed a $787 billion Economic Stimulus Bill to provide help for people who lost their jobs, and to stimulate the economy.

How does the Economic Stimulus Bill affect COBRA health insurance?

Learn more below…

How does the Economic Stimulus affect COBRA?

The government will now subsidize 65 percent of your COBRA premiums for up to 9 months.

Who qualifies for the COBRA subsidy?

  • Americans who involuntarily lose their jobs between September 1, 2008 and December 31, 2009.
  • Those who do not earn more than $125,000 per year (or $250,000 for married couples filing taxes jointly) during the year of getting the subsidy.
  • Dependents of those who qualify for the subsidy.

Do I have to apply for the subsidy?

No, your former employer will know if you qualify for the subsidy.

How do I enroll in COBRA?

Contact your former employer to enroll in COBRA, and to get the details of how to pay your 35 percent of the premiums.

What if I lost my job after September 1, 2008, and I declined COBRA coverage?

It's okay — you can still enroll and get the subsidy. You have until April 14, 2009 to contact your employer to enroll.

If I choose COBRA, will I be reimbursed by the government?

No, you will simply pay your 35 percent to your former employer/former plan administrator. It's the employer who gets the 65 percent reimbursement from the government.

What if I'm already enrolled in COBRA and have paid full premiums?

Your former employer or plan administrator is required to pay you 65 percent of your premiums back, or reduce your future payments by the same amount.

Will my former employer notify me of this subsidy?

By law your former employer is required to inform you of COBRA benefits.

What if I have more questions?

You can contact your former employer to find out exactly how getting your coverage under COBRA works.