General Question

peggylou's avatar

Does he government now pay for part of COBRA insurance peremiums?

Asked by peggylou (1127points) June 14th, 2009

I have been told that the government now will pay 65% of COBRA insurance premiums. Is that correct?

Observing members: 0 Composing members: 0

4 Answers

Jeruba's avatar

I hear the same thing from someone who is now on COBRA. She was involuntarily terminated. Here’s a link.

juwhite1's avatar

The government will subsidize COBRA premiums for certain people… those who were laid off some people who were involuntarily terminated. Those folks who are eligible for this subsidy would have already been notified, and if they became eligible before the law was enacted, they can elect to retroactively pick up COBRA. For most people… those who voluntarily quit their jobs, the government will not provide this subsidy.

dalepetrie's avatar

Basically, the government will reimburse companies 65% of the cost of coverage if they bill the former employee on COBRA only 35% of their cost…they will do this via a reduction in the payroll taxes the company has to send in to the government.

So, if your company shut down (like mine did), it doesn’t do squat for you because the company for which I was working is out of business, is not paying the insurance company directly (I had to go to an individual/conversion policy) and that company is not paying payroll or paying in payroll taxes, so there’s no way to administer it.

Pretty much if you’re laid off but your company stays in business and continues to provide insurance to its employees, when their HR department sends you a notice of your right to continue on COBRA, the rate you are going to be asked to pay should be 35% of their cost, and they should be able to recoup the cost through tax credits.

boffin's avatar

…..Does he government…
And by “he” meaning Obama… a.k.a. taxpayers

Answer this question

Login

or

Join

to answer.

This question is in the General Section. Responses must be helpful and on-topic.

Your answer will be saved while you login or join.

Have a question? Ask Fluther!

What do you know more about?
or
Knowledge Networking @ Fluther