COBRA requires that terminated employees are able to continue their health insurance for 18 months. The recent stimulus bill includes a subsidy for involuntarily terminated employees.
The IRS has published info on how the COBRA subsidy will work for employers.
The subsidy pays 65% of COBRA premiums for employees involuntarily terminated from employment between 9/1/08 and 12/31/09.
Employers receive reimbursement using form 941.
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