Lane 3

More Liability for Employers with less than 20 Employees

Much has been made about the changes to COBRA that are contained in the American Recovery and Reinvestment Act of 2009, but not too many people realize that every employer with less than 20 employees has obligations under this law too. These are not insurance company obligations but employer responsibilities.

Responsibility combined with inaction equals liability.

Basically, the law mandates that certain employees who were involuntarily terminated between September 1, 2008 (yes, 2008) and December 31, 2009 be made to pay only 35% of their state continuation premiums starting March 1, 2009. The special open enrollment provision in the law applies only to COBRA groups, not those subject to state continuation.

So, if you have less than 20 employees and have terminated or will terminate someone do you know how to properly offer them continued health coverage? If not, let me know and we will give you a hand.