News & Updates


New Budget Includes Proposed Extension on COBRA Subsidy

New Budget Includes Proposed Extension on COBRA Subsidy

Among many other items of interest, President Obama’s proposed budget for fiscal year 2011 includes a continued COBRA subsidy proposal.  If enacted (and made retroactive to its proposed start date of March 1, 2010), the provision would continue a 65% subsidy for qualified workers who are laid off between March 31, 2010 and December 31, 2010.  The proposed subsidy would last for a period of 12 months.

Employers will recall that the original COBRA subsidy was enacted about a year ago with the passage of the first stimulus bill.  At that time, the layoff window to receive the subsidy was scheduled to expire at the end of 2009.  Congress enacted an extension of the layoff window, however, which is now set to expire on February 28, 2010.  The President’s budget seeks to once again extend the layoff window and continue the subsidy, if enacted.

Not all workers are “qualified” to receive the premium subsidy.  Information about the different qualification rules can be found at the USDOL’s website: