December 22, 2009

Federal COBRA subsidy extended two additional months for Missourians who lose jobs

Jefferson City, Mo. -The Missouri Department of Insurance says more laid-off workers will be able to receive assistance from the federal government for paying their health insurance costs. A defense appropriations bill signed by President Obama extends the eligibility for workers who involuntary lose jobs until Feb. 28, 2010 - a two-month extension from the previous date of Dec. 31.

Laid-off employees have long had the right to continue their health coverage - known as electing COBRA - but in the past it was their responsibility to pay the full premiums, plus additional fees. A COBRA subsidy under the federal stimulus plan allows laid-off workers to pay just 35 percent of the premium for up to fifteen months.

More specifics of the extended federal subsidy:

  • The 65% COBRA premium subsidy is available to workers involuntarily terminated between Sept. 1, 2008 and Feb. 28, 2010.
  • Eligible workers pay 35% of the COBRA premium.
  • The subsidy is available for up to 15 months. The bill signed by the president extends that from the previous limit of nine months.
  • The employer or health insurer will pay the 65% subsidy amount and can claim that amount as a payroll tax credit at the end of each quarter.
  • Employees of small companies (fewer than 20 workers) are also eligible, under Missouri's "mini-COBRA" law, signed by Gov. Jay Nixon earlier this year.

"This additional assistance will help laid-off workers with their health insurance costs, while we continue to make progress in turning Missouri's economy around," said John M. Huff, director of the Missouri Department of Insurance, Financial Institutions and Professional Registration (DIFP).

Missouri consumers with questions about COBRA may call the Insurance Consumer Hotline at 1-800-726-7390 or visit