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Q: Can I get a refund for some of the COBRA payments I made before the 2009 stimulus package was passed?
- A: No, you can't get a refund of 65% of the premiums you've paid before the stimulus package was passed and lowered the COBRA premiums. However, if you qualify, you can take advantage of the lowered premium now, for up to nine months.If the administrator of your employer's health plan hasn't already done so, you should ask your employer about how to apply for the lower premium. Your employer should also be able to help you recover any amounts you may have overpaid after February 17, 2009 (the date the stimulus package became law).
Q: Can I still get the premium subsidy if my employer closed or went bankrupt?
- A: No. If you lost your job because your employer shut down or filed for bankruptcy protection, you're not eligible for the reduced COBRA premiums.
Q: How do I apply for the COBRA premium subsidy?
- A: If you were involuntarily laid off or discharged between September 1, 2008 and December 31, 2009 and you were covered by your employer's health plan on the last day you were employed, the health plan's administrator should tell you how to elect COBRA and your eligibility for the lower premium. Your employer can also give you the information you need.
Q: How long can COBRA coverage to continue?
Q: Was COBRA changed at all by the 2009 stimulus package?
- A: The American Recovery and Reinvestment Act of 2009 (ARRA) made an important change to the costs of COBRA. Specifically, if you're eligible for COBRA and you were involuntarily laid off or discharged between September 1, 2008 and December 31, 2009, you may be eligible for a reduced premium amount that is only 35% of the premium costs for your COBRA coverage. You can get this reduced premium or premium subsidy for up to nine months.
Q: What about premiums and payments? How are these handled?
- A: Qualified individuals may be required to pay the entire premium for coverage up to 102% of the cost to the plan. Premiums may be higher for persons exercising the disability provisions of COBRA. Failure to make timely payments may result in loss of coverage.
Premiums may be increased by the plan, although premiums generally must be set in advance of each 12-month premium cycle.
Individuals with COBRA coverage may be responsible for paying all costs related to deductibles, and may be restricted by catastrophic and other benefit limits.
Q: What does COBRA do?
Q: What events are covered by COBRA?
- A: Several events that can cause workers and their family members to lose group health coverage may result in the right to COBRA coverage. These include:
- Voluntary or involuntary termination of the covered employee's employment for reasons other than "gross misconduct"
- Reduced hours of work for the covered employee
- Covered employee becoming entitled to Medicare
- Divorce or legal separation of a covered employee
- Death of a covered employee
- Loss of status as a "dependent child" under plan rules
Q: What notification requirements must the employer follow?
- A: An initial notice must be furnished to covered employees and spouses, at the time coverage under the plan starts, informing them of their rights under COBRA and describing provisions of the law. The plan's summary plan description ("SPD") must also contain COBRA information.
When the plan administrator is notified that a qualifying event has happened, it must in turn notify each qualified beneficiary of the right to choose continuation coverage.
COBRA allows at least 60 days from the date the election notice is provided to inform the plan administrator that the qualified beneficiary wants to elect continuation coverage.
Under COBRA, the covered employee or a family member has the responsibility to inform the plan administrator of a divorce, legal separation, disability or a child losing dependent status under the plan.
Employers have a responsibility to notify the plan administrator of the employee's death, termination of employment, reduction in hours or Medicare entitlement.
If covered individuals change their martial status, or their spouses have changed addresses, they should notify the plan administrator.
Q: Who is covered by COBRA?
- A: The law generally covers group health plans maintained by employers with 20 or more employees in the prior year. It applies to plans in the private sector and those sponsored by state and local governments. COBRA provisions covering state and local government plans are administered by the Department of Health and Human Services.
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