Fighting to get a COBRA subsidy

We're wondering what took so long, but the Centers for Medicare and Medicaid Services recently announced the launch of a website that explains the appeals process for people denied a premium subsidy offered under the president's stimulus plan, the American Recovery and Reinvestment Act of 2009, which went into effect earlier this year.

The subsidy program pays 65% of health insurance premium costs under COBRA, which allows many people who have lost their jobs to continue their employer-based insurance for a period of time. (COBRA coverage generally lasts 18 months -- and in some cases 36 -- from the time employment benefits end.) Firms are allowed to charge up to 102% of their cost of providing coverage, which, according to advocacy group Families USA, can often eat up most of a person's monthly unemployment benefit.

There's little news so far on how successful an appeal might be. "Federal agencies reporting on the subsidy requests and appeals have only just begun reporting their data," says Stan Dorn of the Urban Institute, an independent social and economic health policy group. The organization will be assessing the appeals process later this year with funding from the Commonwealth Fund, a private health research think tank, and the California Healthcare Foundation.

The CMS website,, and help line ([866] 400-6689, Monday to Friday, 8 a.m. to 8 p.m. Eastern Time) are run by Maximus Federal Services. Inc., a contractor that is processing appeals and making recommendations for granting the subsidy. (Maximus will also answer many questions by e-mail; CMS promises to make its final determination on a subsidy within 15 business days of a completed claim submission.

The site as well as operators on the help line have answers to general questions about the premium assistance program. The CMS site is intended for eligible federal, state and local government employees as well as many employees of non-profits and for many firms with 20 or fewer employees. Employees of firms with 20 or more workers have their subsidy denials reviewed by the Department of Labor, and Maximus operators will redirect calls that should be answered there.

To qualify for COBRA subsidy assistance, an employee must have been laid off between Sept. 1, 2008, and Dec. 31, 2009, and have opted for COBRA coverage. The subsidy lasts for nine months or until the worker is offered new employer-sponsored healthcare coverage or becomes eligible for Medicare. The subsidy generally will be available only to people whose income does not exceed $125,000 for individuals ($250,000 for families).

For more information, call the Labor Department at (866) 444-3272, Monday through Friday, from 8:15 a.m. to 4:45 Eastern Time, or check additional COBRA premium information at (click on "about premium assistance").


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