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Questions and Answers on COBRA and new ARRA
What is ARRA?
The American Recovery and Reinvestment Act of 2009 (ARRA)
signed into law by President Obama on February 17, 2009
includes a temporary 35% COBRA subsidy for eligible
individuals. ARRA also requires employers to bring their
COBRA programs into compliance with the new COBRA
provisions.
The ARRA Highlights:
ARRA provides that an individual entitled to elect COBRA
continuation coverage as a result of an involuntary
termination of employment that occurs between September 1,
2008, and December 31, 2009 is only to pay 35% of the
regular COBRA premium. The US Department of Treasury will
pay 65%. Qualifying individuals with a modified adjusted
gross individual income of more than $125,000, or $250,000
for joint return, will e subject to subsidy recapture by the
IRS when the individual or joint couple pays tax for the
year. Additionally, the COBRA subsidy program provides a 60
day extended election period for individuals involuntarily
terminated between September 1, 2008 and February 17, 2009.
The subsidized premium is available until the earliest of
any of these conditions:
- Nine months of reduce premiums have been provided
- The first month following the date the qualified
beneficiary becomes eligible for other group health plan
coverage or Medicare.
- The COBRA period otherwise expires or terminates.
Does ARRA apply to dental?
Yes, ARRA applies to medical, dental, and vision.
Will DentaQuest be administering COBRA and the ARRA subsidy?
DentaQuest does not administer COBRA benefits. We do,
however, work with COBRA administrators or groups to provide
dental coverage to individuals who are on a COBRA plan. This
will continue under the ARRA laws.
Where can I get more information on ARRA and COBRA?
For more information, employees may visit
U.S. Department of Labor or
call 1.866.444.3272 to speak to an Employee Benefits Security Administration
Benefits Advisor.
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