Congressmen urge revisiting COBRA subsidy extension after holiday

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Update: COBRA’s extinction will add millions to rolls of uninsured

With an extension of benefits under the Consolidated Omnibus Budget Reconciliation Act (COBRA) removed from a comprehensive jobs bill in the U.S. House, future health coverage for the unemployed remains unresolved going into the Memorial Day weekend.

Henry A. Waxman

What this means is that those laid off from their jobs as of May 31 – when a federal subsidy to assist such individuals expires – will have to pay 100% of their current premiums to continue health insurance.

Dating back to the American Recovery and Reinvestment Act passed last year, the federal government has provided a 15-month insurance premium subsidy of 65% to those involuntarily terminated from their jobs.

Congress extended that eligibility last month through May 31, but has stalled on either a short- or long-term extension.

As part of the jobs bill, passed by a vote of 215-204 by the House, COBRA and other benefits were cut in a move to trim $24 billion and gain enough Democratic votes to provide other aid to unemployed Americans. Remaining benefits in bill would run through November.

Even in the highly unlikely event House members reinstate COBRA benefits into their bill, the initiative will not be acted upon by the Senate, which has convened until June 7.

Media reports indicate House Democrats could offer a smaller benefits proposal extending benefits, including COBRA, for two weeks, to avoid a lapse.

“This bill is going nowhere …and will be rewritten by the Senate,” Rep. David Camp (R-Michigan) said on the House floor.  Rep. John Linder (R-Ga.) added that “the Senate is gone, the door is closed, so nothing will result from this bill.”

Camp added his displeasure that COBRA was eliminated from the $52 billion bill, which he opposes, adding that lawmakers “owe it to ourselves and the American people to know how much deficit spending we are expected to swallow.”

Camp added that Republicans believe the benefits should be extended, but done responsibly by not increasing federal spending.

‘Hurting vulnerable people’

Rep. Henry A. Waxman (D-Calif.) said he supports part of the bill to help doctors with reimbursement from Medicare, or the “doc fix,” which he deemed “absolutely critical.” The measure would extend the delay of a cut in reimbursements for 19 months.

Waxman also voiced his disappointment in the exclusion of COBRA benefits, indicating the House was “hurting vulnerable people” by not addressing the matter and hoped COBRA would be addressed following the holiday recess by both congressional bodies.

It remains to be seen if legislators will revisit extending the COBRA subsidy or what it could look like when they return to Washington, D.C., but if it is addressed, it is likely benefits will be retroactive to the May 31 deadline.

Legislators could also decide to not extend the coverage period of 15 months for the subsidy, but rather the eligibility period, meaning unemployed workers would have 15 months from the date they start receiving the subsidy to obtain federal assistance.

For those who started receiving the subsidy last March when the American Recovery and Reinvestment Act was passed, they are facing a deadline to pay 100% of their premiums if the subsidy ends.

2 Responses

  1. Jan Says:

    Is there any news of Cobra subsidy being revisited for 2011?

  2. Bob Graham Says:

    No action on COBRA has been pondered to my knowledge. With a Republican majority in the U.S. House of Representatives and Republicans’ push for less spending to lessen the debt, efforts to extend COBRA are likely to fail quickly.

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