The plan applies only to an “assistance eligible individual” or AEI who is laid off through no fault of his or her own, or is a dependent of a laid-off employee.
The subsidy applies beginning March 1, 2009 for employers who use calendar months for healthcare coverage.
The bill, signed into law by President Barack Obama on February 17, 2009, provides a government subsidy of COBRA continuation coverage for a maximum of 9 months for certain laid-off workers and their eligible dependents. The measure does not cover employees who voluntarily quit.
Under the ARRA, plan administrators need to inform eligible employees and their beneficiaries of the program, implement extended COBRA coverage periods, and implement administrative procedures to take advantage of the subsidy.
In one of the major changes, the ARRA will subsidize 65% of the COBRA premium charged (more…)