Blog Post: Change Is Coming: New COBRA Forms Released Today.

The Consolidated Omnibus Budget Reconciliation Act of 1985, commonly called COBRA, provides departing employees with a way to continue taking advantage of employer-sponsored health insurance even after their relationship with their former employers is resolved.

The American Recovery and Reinvestment Act of 2009 changes COBRA. As explained by the Department of Labor, under ARRA, eligible individuals pay only 35 percent of their COBRA premiums and the remaining 65 percent is reimbursed to the coverage provider through a tax credit.

The premium reduction applies to periods of health coverage beginning on or after February 17, 2009 and lasts for up to nine months for those eligible for COBRA during the period beginning September 1, 2008 and ending December 31, 2009 due to an involuntary termination of employment that occurred during that period, says the Department of Labor.

Who are "eligible individuals"? What is an "involuntary termination"? Well, we expect to see regulations and guidance issued soon to interpret these somewhat vague terms but, for now, employer would be wise to adopt a broad interpretation of who might fall into these categories.

But all of this legal mumbo jumbo leads the seasoned HR professional to one painfully practical question: "What forms do I use? The new provisions went into effect on the 17th, but we do not have forms?"

The 48 hour wait is over! Look no further! Act Now! Buy One Get One Free! (OK, Now I am getting carried away). Today, the Department of Labor issued new forms for separating employees that comply with ARRA. They can be found on the Department of Labor's Website at: http://www.dol.gov/ebsa/COBRAmodelnotice.html.

Laura J. Hazen is a Director at Ireland Stapleton Pryor & Pascoe, P.C. In her employment practice, Hazen provides day-to-day advice and coaching to public and private companies on various employment matters. She also has an active litigation practice where she concentrates on representing business in all aspects of complex business and employment disputes. You can contact her by email at lhazen@irelandstapleton.com or by phone at 303-623-2700.

This article is intended as a general discussion and information on the topic covered, and is not to be construed as rendering legal advice. If legal advice is needed, you should consult an attorney. This article may not be reprinted or reproduced in any manner without prior written permission of the author.