New Employer Obligations for COBRA Under
the American Recovery and Reinvestment Act of 2009

The 2009 stimulus bill outlined changes to the nature of COBRA coverage for terminated employees. As you know, COBRA is a federal law that allows former employees and their families to retain group health coverage, generally for 18 months, after experiencing a “qualifying event,” such as a loss of employment or a reduction of hours. Group health plans under COBRA are defined broadly and include not only medical plans, but also dental, vision, prescription drug, health flex spending accounts, health reimbursement arrangements and certain wellness and employee assistance plans. Under COBRA, if the former employee or his/her qualified beneficiaries desire to continue coverage through COBRA, the employee or qualified beneficiary is required to pay the full cost of the monthly premium.

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Published: 02/2009