Keep in mind that some
individuals may be eligible for COBRA premium subsidies beyond Aug. 31, 2011, the U.S. Department of Labor (DOL) noted today in updated material on its website.
The updated frequently-asked-question on the end of the subsidy period follows:
Q1: I’ve heard that the COBRA Premium Reduction (Subsidy) ends on August 31, 2011, is this true?
Not necessarily, some individuals will still be eligible to receive the subsidy beyond August 31, 2011. The American Recovery and Reinvestment Act (ARRA) provided a COBRA premium reduction for eligible individuals who were involuntarily terminated from employment through the end of May 2010. Due to the statutory sunset, the COBRA premium reduction under ARRA is not available for individuals who experience involuntary terminations after May 31, 2010. However, individuals who qualified on or before May 31, 2010 may continue to pay reduced premiums for up to 15 months, as long as they are not eligible for another group health plan or Medicare even if their COBRA coverage did not start until a later date due to the terms of a severance arrangement, or the use of banked hours or other similar provision that delayed the start of their COBRA coverage. For example if an individual was involuntarily terminated on May 31, 2010 and due to the terms of a severance agreement their COBRA coverage did not start until December 1, 2010, they would still be eligible for the full 15 months of subsidy through February 29, 2012 as long as they are not eligible for another group health plan or Medicare.
See background on the subsidy law here and here. To see all DOL FAQs on the subsidy law, go here.