The American Recovery and Reinvestment Act of 2009 (ARRA), was amended on March 2, 2010 by the Temporary Extension Act of 2010.  ARRA provides for premium reductions for health benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985, commonly called COBRA.

Eligible individuals pay only 35 percent of their COBRA premiums and the remaining 65 percent is reimbursed to the coverage provider through a tax credit. To qualify, individuals must experience a COBRA qualifying event that is the involuntary termination of a covered employee's employment.

The involuntary termination must generally occur during the period that began September 1, 2008 and ends on March 31, 2010. An involuntary termination of employment that occurs on or after March 2, 2010 and follows a qualifying event that was a reduction of hours and that occurred at any time from September 1, 2008 through March 31, 2010 is also a qualifying event for purposes of ARRA.

The premium reduction applies to periods of health coverage that began on or after February 17, 2009 and lasts for up to 15 months.

This extension also will apply to anyone receiving continuation of coverage under Virginia continuation of coverage provisions for individuals not eligible for COBRA.

Notice Requirements 

If you are eligible for this premium reduction, your employer will be providing you notice prior to March 31, 2010. However, if you have any questions regarding your eligibility, please contact your employer.

For more information on your COBRA subsidy rights please refer to the Department of Labor's Web page at www.dol.gov/COBRA* or the State Bureau of Insurance Web site at www.scc.virginia.gov/division/boi/webpages/inspagedocs/cobra.pdf.*

* This link will launch a new browser window and take you to an external Web site not owned or operated by Optima Health.