Watkins Ludlam Winter & Stennis, P.A.

On March 2, 2010, President Obama signed the Temporary Extension Act that extends the COBRA subsidy program.  Under the extension, employees who have been involuntarily terminated from March 1, 2010 through March 31, 2010, will be able to take advantage of the entitlement to a fifteen month 65% subsidy of their COBRA premiums.  Employers will continue to be allowed to claim the 65% on their quarterly tax returns.  The Act also allows employees to receive the subsidy if they first lost group coverage due to a reduction in hours and then were terminated after enactment of the bill.  In the meantime, Congress is still considering whether the program should be extended through December 31, 2010.