How is the COBRA subsidy calculated if the employer already more generously subsidizes the COBRA premium?
The premium subsidy can be claimed for 35% of the amount the employer is actually charging the employee. For example, if an employer chooses to subsidize the premium at 80%, and the total cost for COBRA coverage is $1,000 per month, then the employee premium is $200 per month. With the COBRA subsidy, the employee can pay only 35% of the $200 ($70/month) and the employer can claim 65% of the $200 ($130/month) as a payroll tax credit.
Related Questions
- How is the COBRA subsidy calculated if a severance program has the employer paying 100% of the cost for a specified period of time?
- How can I file an appeal if my former employer’s group health plan denies my application for the premium subsidy?
- Are There Potential Penalties for Plan Sponsors that Fail to Provide the New COBRA Premium Subsidy Notice?
