Friday, June 4, 2010

House passes benefits bill without COBRA subsidy extension

The House approved legislation on May 28, 2010, which would require 401(k) fee disclosures, provide relief for pension funds and extend unemployment benefits. The bill also included the so-called ‘doc fix’ that would keep physicians from facing a cut in Medicare payments; however, the planned extension of the COBRA premium subsidy was noticeably absent from the legislation.

Reports suggest that Democrats dropped the extension in order to gain enough votes for passage. According to CongressDaily, the bill would have provided $6.8 billion to extend the 15-month 65% subsidy through November 30, but was removed to appease the fiscally conservative ‘Blue Dog’ Democrats.

Without an extension, employees laid off beginning June 1 would not be eligible for the subsidy. It is unclear whether a retroactive measure will be passed by Congress at a later date. The Senate is not expected to take up the legislation until after returning from their Memorial Day recess on June 7.

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