New York Gov. David Paterson has proposed giving workers at small companies another chance to apply for so-called mini-COBRA coverage despite declining it initially.
Under an economic stimulus bill signed last month by President Barack Obama, the federal government will pay 65 percent of COBRA premiums for employees laid off from September 1, 2008, through December 31, 2009.
The subsidy is provided up to nine months, until an individual becomes eligible for coverage in a new employer’s health plan or becomes eligible for Medicare.
However, federal law requires that COBRA be offered only by employers with 20 or more employees. Some states, such as New York, have so-called mini-COBRA laws that require health plans offered by employers with fewer than 20 employees to extend COBRA.
While the stimulus law extends the 65 percent COBRA premium subsidy to those receiving coverage under state mini-COBRA statutes, the federal law did not include a special election period for those who initially declined mini-COBRA coverage and now want to receive it.
Paterson’s proposal would amend state law to give those who declined mini-COBRA coverage a second chance to apply for it, and receive the 65 percent federal premium subsidy.
Filed by Jerry Geisel of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.
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