President Obama has once again extended the COBRA premium subsidy. The Temporary Extension Act of 2010 extends the eligibility for the 65% premium subsidy for an additional 31 days. Individuals who are involuntarily terminated on or before March 31, 2010 are now eligible for the subsidy.

Significantly, the Temporary Extension Act also grants eligibility for COBRA and the subsidy to certain other individuals who are terminated between March 2 and March 31, 2010 but previously lost group coverage due to a reduction in hours. Under the new law, an involuntary termination of employment that occurs on or after March 2, 2010 and follows a qualifying event that was a reduction of hours and that occurred at any time after September 1, 2008 is also a qualifying event for purposes of the subsidy. This is true regardless of whether the individual previously elected coverage and extends to those who had elected but subsequently discontinued coverage.

In addition, other legislation has been proposed that may result in an additional extension of the subsidy period through December 31, 2010.