COBRA Subsidy Extension: Michigan's Unemployed Receive Holiday Gift

The COBRA subsidy extension was signed this week by President Obama. For the unemployed workers of Michigan this is a beautiful Christmas gift. Being part of the unemployed families in Michigan our COBRA subsidy ran out on December 1. The $389 COBRA payment monthly as of December 1 went up to $1,111. A payment we could no longer afford. We will now receive an additional 6 months of the option to carry COBRA.

With Michigan being the hardest hit in the recession, unemployment has grown higher than in any other state. It is now estimated that 1 in 5 families now receive some sort of public assistance in Michigan. Without the Cobra subsidy extension, many Michigan families would no longer be able to have health care for their families. I know we were looking at losing ours. There is no way we could continue affording health care at over $1100 a month. Even at the current $389 we probably will not be carrying COBRA much longer. We simply do not have the money. Unemployment benefits just barely cover our housing costs.

The phone call from my husband's past employer on the 23rd of December, notifying him that his COBRA subsidy payment had been extended, was a very welcomed relief just in time for the holiday. The human resource person who contacted him was very thorough in explaining exactly what he had to do to continue being on the COBRA subsidy program. With the struggles every Michigan unemployed has to find a job here, getting any type of break is welcomed news.

On December 21, 2009 the U.S. Department of Labor news released the statement that the COBRA subsidy was to be extended. This statement was released by Phyllis C. Borzi, Assistant Secretary of the Employee Benefits Security Administration. The statement goes as follows:

"I am pleased Congress has acted and the President has signed the Fiscal Year 2010 Defense Appropriations Act. The act extends the eligibility period for the COBRA premium reduction for an additional two months (through Feb. 28, 2010) and the maximum period for receiving the subsidy for an additional six months (from nine to 15 months). Millions of unemployed Americans and their families will be better able to afford and keep their health benefit coverage because of this new law.

"Individuals who had reached the end of the reduced premium period before the legislation extended it to 15 months will have additional time to pay the reduced premiums related to the extension. To continue their coverage they must pay the 35% of premium costs by (60 days after date of enactment) or, if later, 30 days after notice of the extension is provided by their plan administrator.

"We encourage you to subscribe to our COBRA Web site, www.dol.gov/cobra, to get information on new notice requirements, updated guidance, fact sheets, and frequently asked questions as they become available.

"Individuals should contact their plan or health insurance provider for information regarding the extension under their health plan. If you need further assistance contact an EBSA Benefits Advisor toll-free at 1-866-444-3272."

This Act should hopefully help many in need of health insurance not only here in Michigan but throughout the country until people can return to work. This may only be a bandage for now but today we have health insurance and it feels pretty good thanks to the COBRA subsidy extension.

Source: http://www.dol.gov/ebsa/cobra.html
Source: http://www.dol.gov/ebsa/newsroom/2009/ebsa122109.html