President Obama signed
The COBRA subsidy under the American Recovery and Reinvestment Act of 2009 (ARRA) requires eligible employees to pay 35% of the COBRA premium, or about $3,000 a year for the average worker. Under the original COBRA law, most involuntarily terminated workers were required to pay 100% of the health care premium plus an additional 2% to cover administrative costs.
An increasing number of employees likely will take advantage of this extension. A new analysis from
Hewitt's analysis examined the COBRA enrollment activity for 200 large U.S. companies representing 8 million employees from March 2009 to November 2009. During that period, monthly COBRA enrollment rates for subsidy-eligible employees averaged 39%, compared to 19% for the period of September 2008 to February 2009—prior to when the subsidy was enacted.