Wednesday, March 11, 2009

COBRA Changes For Stimulus?

Med Law Blog has the details, but TPS friend Jason Oberle nails down what amounts to a rewriting of expired contracts:
Consider firm A has 100 employees and between Sept. 1, 2008 and Jan. 1, 2009 50 employees have been let go. The average cost of 65% of the COBRA benefit being carried by the employer is $650. Now that employee must retro-actively notify and further support the 50 people at $650 on the corporate books until the next tax season before the federal government will reimburse through a tax-credit. Sounds like an additional cost of $32,500 per month on the struggling business.

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