2009 Stimulus Bill Changes Cobra Plan for Unemployed Workers

As you know employers are required to provide health insurance coverage for 18 months after an employee leaves his job under the Cobra act. What has changed with the Cobra law under the new 2009 stimulus plan from the Obama administration may surprise many people.

The provisions embedded in the over $800 billion dollar stimulus plan that passed, would load employers down with new provisions for Cobra administrators. This will be the biggest change ever since Congress enacted the law in 1986 to help Americans maintain health care coverage. The additional Cobra provision under H.R. 598 has two major measures that have a massive cost for today and tomorrow.

First, if an individual stops working as early as age 55, they could retain Cobra coverage until they reach Medicare eligibility. It also doesn’t matter how long they have worked for the employer either. They would still be eligible under this new twist to the economic stimulus plan pushed through by mostly Democrats.

The law currently allows for health insurance coverage for only 18 months after the employee leaves. Under current Cobra law, the employee must pay 102% of the health insurance premium or the coverage is lost.

Second, the Cobra bill provides for a federal “COBRA Premium Subsidy” for employees that were laid off from Sept. 1, 2008, through Dec. 31, 2009. The subsidy will cover 65% of the health insurance premium payment for up to 9 months through a Cobra plan provider. The provider will receive compensation in the form of a tax credit to cover the shortfall in the insurance premium payment.

There has been little opposition to the plan given the economic slump that started in 2008 and seems to be headed deep into 2009. Most employers agree that to provide assistance with health insurance premiums on a temporary basis is an excellent idea.

Systems Are Go

What you should be advise of when registering for Medicare.

If you have reached retirement age, or if you are in need of stable health care insurance, chances are you have considered signing up for Medicare. The federal government backs the Medicare plan, and it is accessible to U.S. citizens or permanent residents who are 65 and older and who have worked for at least a decade through a Medicare-covered employer. People who are unable to work or who are in end-stage renal failure might also qualify for Medicare. Two plans are accessible through Medicare; Plan A and Plan B. Medicare Part A refers to hospital stays, while Medicare Part B covers medical expenditures. Once you are accustomed to the steps, registering for Medicare is an easy process.

If you already get Social Security benefits, you do not need to take additional measures. People who get Social Security benefits already are enrolled for Medicare. Also, as a Social Security recipient, you are exempt from the premium requirements; you may just use the benefits of the program. Questions are best directed to advocates at your neighborhood Social Security Office.

Your first step is to determine that you meet the primary eligibility requirements if you are not already enrolled. You must determine if you or your spouse has labored for a Medicare-providing employers. Do you have paperwork that you are now age 65 or over? Are you currently determined to be unable to work? You may conduct a self-assessment by surfing to the federal Medicare Web site and answering an online questionnaire. Eligibility will be validated, or you will receive instructions about what criterion you need to reach to be eligible.

If you are considered to be entitled, you have a few choices to begin receiving benefits. You may call the Social Security number, and a help person can guide you through the process. You might consider visiting the local Social Security Office where a representative can serve guide you through the paperwork.

Medicare is a means of offering health insurance coverage to those citizens who require it the most. See more about your eligibility for Medicare; getting in is simple, and you can bring about getting those benefits as soon as possible.