The DOL issued a fact sheet regarding the extension of the COBRA premium subsidy on December 23 and it is available here. I think there are some points of clarification that are important in the notice.

First, while the period for measuring the involuntary termination for eligibility must occur during the period that began September 1, 2008 and ends on February 28, 2010, the premium reduction period in this extension only applies to periods of health coverage that began on or after February 17, 2009 and lasts for up to 15 months.

Second, the extension of the COBRA premium reduction eligibility period is currently only for two months until February 28, 2010. In addition, individuals who had reached the end of the reduced premium period before the legislation extended it to 15 months will have an extension of their grace period to pay the reduced premium. To continue their coverage they must pay the 35 percent of premium costs by February 17, 2010, or, if later, 30 days after notice of the extension is provided by their plan administrator.

Third, the notice seems to make clear that there is no premium reduction for premiums paid for periods of coverage that began prior to February 17, 2009. Therefore, individuals whose nine months of subsidy expired before the passage of this extension would not be able to "re-elect" this extra six months of subsidy.

Fourth, individuals who lost their subsidy and paid the full 100 percent premium in December 2009 should contact their plan administrator or employer sponsoring the plan to discuss a credit for future months of coverage or a reimbursement of the overpayment.

My interpretation is that if an individual exhausted their nine months of subsidy eligibility prior to November 30, 2009, or who dropped COBRA coverage prior to November 30, 2009 and did not pay December premiums would not be eligible to receive the additional 6 month extension. So you have to be on COBRA, receiving the subsidy, and paid current thought November 30, 2009 to get the additional 6 months, which would then allow you to retroactively receive a refund of 65% from your December 2009 premiums.

Going forward, the new subsidy period is 15 months, so individuals who have not used up all 9 months of their subsidy eligibility should be told about the extension. We are expecting a sample notice to be circulated shortly.