Secova Reports COBRA Premium Subsidy Extension Enacted by Congress

NEWPORT BEACH, CA – December 23, 2009 – Secova Inc., a leading provider of human resource and benefit management services, today released a summary of the legislation signed by Obama into law on December 21, 2009, extending the COBRA Premium Subsidy. The legislation was part of the Department of Defense Appropriations Act, 2010 (H.R. 3326).

“Today’s healthcare is anything but simple,” said Joel Carter, Vice President of Secova, ” As a result of this legislative change, companies and their plan administrators must act immediately to comply with the extended timelines and allow for reentry into COBRA plans under certain newly allowable circumstances.”

Monday’s changes require employers and other group health plan sponsors, insurers and administrators to act immediately to comply with amended eligibility and subsidy mandates applicable to “assistance eligible individuals” directed towards the extension of the COBRA Premium subsidy.

The new law addresses the following:

1. COBRA Subsidy Eligibility Period – New February 28, 2010 Cut-Off Date

Individuals who are involuntarily terminated from employment before December 31, 2009 are eligible for ARRA premium reduction for an additional 2 months (through February 28, 2010) if they elect COBRA.

2. Length of Subsidy – Additional 6 Months Of Coverage

COBRA premium subsidy is available to the Assistant Eligible Individuals for an additional six months to a total of 15 months. Employees and employers should not confuse the COBRA premium subsidy with the length of COBRA coverage itself.

3. Retroactive Payments – Allowed For Reinstatement In Some Cases

Assistant Eligible Individuals who failed to pay their COBRA premiums once their initial subsidy period expired can retroactively pay the premiums to maintain COBRA at subsidized rates for an additional 6 months (not to exceed the maximum period of 15 months).

4. Notification – New Provisions

The new law requires notices to the following individuals: (a) those individuals who are AEI’s for the subsidy extension or those who have experienced a qualifying event at any time on or after October 31, 2009 or (b) those who are eligible to make retroactive premium payments because they let their COBRA coverage expire once their subsidy period ended, and (c) those who are entitled to receive reimbursement or credit because they are eligible for additional assistance but paid the full amount of the premium coverage.

The extension of the COBRA Premium subsidy gives very little time to implement new administrative procedures and to meet the new notice requirements. Clarifications are being released daily by the Department of Labor, Treasury and Health and Human Services. Secova will be monitoring and advising businesses of all changes and the associated recordkeeping and administrative requirements. Secova is focused on fulfillment of the COBRA subsidy and is dedicated to providing compliant solutions across all industries.

Secova is a leading Benefits Management Services company that delivers customized “Value-Sourced” solutions designed to enhance services and reduce operating costs. Secova’s mission is to help its clients control and drive down the cost of delivering Human Resources & Employee Benefits Services. Secova’s customized and flexible benefits administration solutions are designed to complement the client’s overall benefit administration strategies, to help lower costs and improve service quality while enhancing timeliness, accuracy and responsiveness to the client’s employees. More information on the company is available at

This press release was distributed through PR Web by Human Resources Marketer (HR Marketer: on behalf of the company listed above.