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Q:  I elected to take a buyout from General Motors. This was to avoid the need to uproot my family, sell my house, and move across the country, as General Motors has decided to close my plant. Were my plant not being closed by GM I would still be working. Had GM not imposed a date of July 31 to accept the buyout I would still be working, my question is, am I eligible for the subsidized cobra? My leaving was not what I would have chosen had my place of employment not been slated to close.

A:  This is the latest information on the stimulus that I am aware of, you can visit the Department of Labors website at www.dol.gov/COBRA to see if there is any further information on there.  You can also try to speak with your benefits department to see if Cobra is going to be subject to the reduction.  If you meet the requirements necessary to receive the stimulus reduction.  I truly wish I could help you more in regards to this matter; my family is in the same situation. 

The American Recovery and Reinvestment Act of 2009 (also know as the federal stimulus package) provides for premium reductions and additional election opportunities for health benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985, commonly called COBRA. Eligible individuals pay only 35 percent of their COBRA premiums and the remaining 65 percent is reimbursed to the coverage provider through a tax credit. The premium reduction applies to periods of health coverage beginning on or after February 17, 2009 and lasts for up to nine months.

The premium reduction for COBRA continuation coverage is available to "assistance eligible individuals".

An "assistance eligible individual" is the employee or a member of his/her family who:

·         is eligible for COBRA continuation coverage at any time between September 1, 2008 and December 31, 2009;

·         elects COBRA coverage; and

·         is eligible for COBRA as a result of the employee's involuntary termination between September 1, 2008 and December 31, 2009.

Those who are eligible for other group health coverage (such as a spouse's plan) or Medicare are not eligible for the premium reduction. There is no premium reduction for premiums paid for periods of coverage prior to February 17, 2009.

If an individual’s modified adjusted gross income for the tax year in which the premium assistance is received exceeds $125,000 (or $250,000 for joint filers), then the amount of the premium reduction during the tax year must be repaid.