According to the US Department of labor (see excerpt below), the dismissed workers were supposed not to have to worry about fronting premiums and employers / plan administrators would be gone for reimbursement of 65 percent by the government
Q10. How does the subsidy bonus of 65% paid for me?
You will not receive a payment. Assistance Eligible persons are responsible for paying only 35% of the COBRA premium for the coverage period. The remaining 65% of the premium is paid directly to the employer, plan administrator, or the insurance company through a tax credit on payroll.
But an article in the Washington Post said that everything might not work as expected.
The author describes his situation where he had to pay his COBRA continuation premium of more than $ 1,400 per month or its coverage would be canceled. Instead of paying 35 percent premium to its former plan administrator, he had in front the money and wait for reimbursement.
In the article, the author heard these repayments could not be made available until this summer.
This is far too long, and frankly it is a scandal what happens. The DOL makes clear that it is the employers / plan administrators who have to put up money.
We'll keep our ears open for similar situations, but we hope that this is not common. Let us know if it is.
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