In response to a large number of questions received regarding eligibility for the COBRA premium reduction under current law, the Employee Benefits Security Administration (EBSA) has updated the COBRA page (www.dol.gov/COBRA) to add new FAQs here. We encourage readers to visit this page for updates. 

Congress has extended the federal subsidy for COBRA Health insurance premiums for employees who are terminated involuntarily. The nine-month, 65% premium subsidy is extended by six months, to a total of 15 months.

The subsidy now is available to those who involuntarily lose their jobs through February 28, 2010. The legislation also provides an additional six months of subsidized coverage for beneficiaries whose initial nine-month COBRA premium subsidy has run out. In addition, the legislation gives beneficiaries whose subsidy ran out, and who did not pay the full premium, a second chance to opt for coverage. For example, a beneficiary whose nine months of subsidized coverage ran out November 30, and who did not pay the regular unsubsidized December 2009 premium, can pay the 35% premium share in January 2010 and receive coverage for December. The legislation requires employers to notify current COBRA beneficiaries and future beneficiaries of the new 15-month premium subsidy.