COBRA Subsidy Extended Again

On March 2, 2010, the president signed into law H.R. 4691, the Temporary Extension Act of 2010 ("TEA of 2010"), which provides a short-term extension of the COBRA subsidy initially established under the American Recovery and Reinvestment Act of 2009 ("ARRA") and set to expire February 28, 2010. As a result of the extension, individuals who become qualified beneficiaries because of an involuntarily termination of employment on or before March 31, 2010, will be eligible for the COBRA subsidy.

The TEA of 2010 also expanded the ARRA qualifying events. Prior to the TEA of 2010, a qualified beneficiary who became eligible for COBRA continuation coverage as a result of a reduction in hours of employment generally could not become eligible for the COBRA subsidy. As a result of the TEA of 2010, an involuntary termination of employment that occurs on or after March 2, 2010, and that follows a reduction in hours of employment that constituted a COBRA qualifying event that