A new state law has created a special election period giving people laid off from small businesses (between 2 and 19 employees) a second chance to access the federal COBRA subsidy. Providing they are otherwise eligible for this benefit, individuals may now elect the "mini-COBRA" coverage they were offered in the past and get help paying those premiums.
This special election period began July 2, 2009 and will last until 60 days after each individual receives the required notice from their health plan. (Health plans have until September 1 to notify eligible people.)
- In order to participate in this special election period, an individual must have been involuntarily terminated from employment between September 1, 2008 and February 16, 2009—and become eligible to continue their health insurance through mini-COBRA as a result.
- This special election applies both to those who did not elect mini-COBRA when it was first offered, and those who did elect mini-COBRA but are no longer enrolled (for example, because they were unable to continue paying the premium).
- The federal COBRA subsidy pays 65% of the COBRA premium for eligible people who lose their jobs between September 1, 2008 and December 31, 2009. Anyone who makes less than $125,000 a year ($250,000 for a married couple) may be eligible for the full premium reduction.
- In addition to the federal COBRA subsidy, people at or below 400% of the Federal Poverty Level may be eligible for the Medical Security Plan (MSP). This can bring the individual’s share of COBRA costs down to only 7% of the original premium.
A similar special election period has already taken place for former employees of larger businesses (20 or more employees).
Anyone who is laid off outside between February 17, 2009 and December 31, 2010 may access both the federal COBRA subsidy and the Medical Security Plan, if they are eligible, without a special election period.
Thank you to Georgia Maheras for bringing this development to light via her post on A Healthy Blog.
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