COBRA extension approved

Laid off workers worried about losing their health care benefits got an early Christmas present today when the Senate passed a $626 billion defense spending bill this morning by a vote of 88-10. Buried within the bill is a provision to extend the COBRA subsidy for another 6 months.

The provision is the senate version of a house bill to extend the 65% subsidy of the COBRA health care insurance benefit to laid off workers. That subsidy expired November 30th for those who started getting the subsidy in March. President Obama voiced his support for the extension at the White House Jobs Summit last week and Congress has been under increasing pressure to extend the subsidy. The bill now awaits his signature.

Federal law requires employers to provide health care insurance to workers laid off for up to 18 months, though it is up to the employee to pay the premiums. These premiums average $1,111 per month for a family according to a study by Families USA, representing more than 83% of an average unemployment check

The federal government had been paying 65% of that premium as part of the American Reinvestment and Recovery Act since last march and it was designed to provide this subsidy for 9 months. The defense bill, which was expected to pass, will extend the sign up date for the benefits to the end of February and would extend the 9 months to 15 months.