01/04/2010
John Riley Insurance Services would like you to know that President Obama signed into law on December 21, 2009 an extension and expansion of a COBRA premium subsidy law that was due to expire on December 31. The extension means new compliance obligations for employers, as that the program now runs through February 28, 2010, the subsidy period is expanded by six months and new notice requirements must be met within a tight time frame.
Although I have provided the full briefing from BenefitMall, the way in which this extension was rolled out was similar to the initial roll out; in pieces. The legislation does explain that plan administrators must send out notices however, it is not clear whether insurance companies for Cal-COBRA (groups under 20 employees) will be sending them out (which is usually the case). For groups of less than 20 employees and Federal COBRA over 20 employees, there should be template letters available soon. Like last year, once the legislation is announced, there is a delay in getting the instructions out to the carriers, administrators and HR departments. Please feel free to call or e-mail me if you have any questions, otherwise I will keep you updated as the information comes in. Additionally, you should receive an update from your payroll company that explains the likely hood you will need to amend your Form 941 to claim prior year tax credit. If you have not, let me know and I can send you the one I receive from Perquest Payroll, another excellent partner. For more information on the COBRA Subsidy Extension please see View Docs
