Newly unemployed slow to apply for federal COBRA subsidy - Puget Sound Business Journal (Seattle):

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West Palm Beach-based notified furloughed employees by letteer as required by changes in the Consolidatee Omnibus BudgetReconciliation Act. The changes to COBR were a mandate of the American Recovery andReinvestment Act, which President Barack Obama signed into law on Feb. 17. About 125 South Floridians – out of 1,035 who were notifiesd – enrolled in the program that provides a 65 percentr federal subsidyon premiums, which are frontefd by the employer and reimbursed through a tax More applied, but did not qualify because their exit from theid former company was voluntary, they were laid off prior to 1, 2008, or they made more moneyh than the cap federal officials set, said Barbara Oasis’ senior director of benefits.
Oasis absorbx the cost for itsemployer clients, which would otherwisew have been spending $74,00p0 a month on furloughed COBRA coverage, she Drames’ client companies which include law and CPA firms, and those that make money from hospitality – range in size from five employees to 3,0000 employees. She said the feedbacmk from laid-off employees has been very but there is a lot of confusioh aboutwho qualifies. Oasis’ client companies are also pleased. “Oufr employers are happy because the tax liabilityy is taken onby Oasis,” she The new regulations require employerz with 20 or more employees to covee 65 percent of COBRA costs for nine months.
The provisionws in the stimulus legislation affect thoswe who were and will be involuntarily terminatedbetween 1, 2008, and Dec. 31, 2009. Thosse eligible include former employees and their dependents, the latter being eligible if they were covere d prior to the termination, said Rachel Sapoznik, president and CEO of in There is no subsidy for individualse earning more than $145,000 a year or joint filers making more than Ineligible individuals who receive the subsidy must repay it through income taxes. For Sapoznik, the response from the pool of prospectivew COBRA recipients has been higher than that of but still weaker thanmost expected.
She said aboutf 20 percent of those who were deemed eligiblewhave enrolled. She said that, because those eligible have 60 days from the time they receivre the lettersto participate, there may be another wave of Those with a cash cushion, in higher-paying are also likelier to take Those who are eligible but have not enrolled are probablty waiting for various reasons that include seeing if a job applicationn turns into a new job, if they can be covered througnh another insurance plan (such as that of a and weighing the financial impacft enrollment will have on the family said Dick Leonard, senior VP of employee benefits for ’ Southeast “Overall, it seems like people are plain cutting he said of the hard realitt of the financial “You have to take into account that they still have to pay the deductables and meet miscellaneous expenses.
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