Pay COBRA subsidy directly to me?

Q. I have heard that the stimulus package signed by President Obama includes a temporary COBRA premium reduction for my health insurance after my lay off from my job. I understand that if I qualify, I pay 35% of my COBRA premiums, and there is a 65% subsidy. How does the 65% premium subsidy get paid to me?

A. You will not receive a payment, according to the US Department of Labor. Assistance Eligible Individuals are responsible for paying only 35% of the COBRA premium for the period of coverage.

The remaining 65% of the premium is reimbursed directly to the employer, plan administrator, or insurance company through a payroll tax credit. For more information about the stimulus COBRA subsidy see the Department of Labor's FAQs.

Deny my COBRA coverage?

Q. My health coverage was terminated when my employer shut down and laid off all its workers. HR tells me there is no longer a health plan, but I understand the economic stimulus was supposed to help continue my health coverage through COBRA. Can my boss do that?

A. Possibly. Although the American Recovery and Reinvestment Act provides a premium-reduction to help qualified individuals pay for COBRA continuation health coverage, if there is no longer a health plan, there is often no COBRA coverage available. If related employer or successor employer sponsors a group health plan, it may be responsible for providing coverage to you, according to the US Department of Labor.

If you believe a related or successor employer may be responsible for providing you with COBRA coverage, you can contact the employer directly or EBSA toll free at 1.866.444.3272 to speak to a Department of Labor Benefits Advisor for assistance.