Stimulus Package: An In-Depth Look at the New COBRA Subsidy in the ARRA

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The massive $787.2 billion economic recovery package signed into law as the American Recovery and Reinvestment Act of 2009 (ARRA) by President Obama on February 17, 2009, will impact employers in several ways. One of the major components of the ARRA is the COBRA subsidy and tax credit available to employers who pay for part of the COBRA premium for terminated employees. As a result, there are additional burdens, pitfalls and hidden costs on the vast majority of employer-sponsors of group health plans.

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