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Senate passes bill containing health coverage tax credit

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Employees who lose their jobs due to foreign competition or worked for companies whose pension plans failed would again be eligible for federal health insurance premium subsidies under legislation approved by the Senate.

Under the measure, H.R. 1295, which the Senate passed Thursday on a voice vote, the federal government would pay 72.5% of premiums for health plan coverage, like COBRA, for people who were laid off from their jobs due to foreign competition, and for retirees ages 55 through 64 in pension plans that were taken over by the Pension Benefit Guaranty Corp.

The premium subsidy also would be available for plans offered through voluntary employee beneficiary associations set up for those who worked in such industries as steel and auto parts manufacturing that failed and went out of business.

Known as the health coverage tax credit, the subsidy expired in 2013. The measure passed by the Senate would extend the premium subsidy through the end of 2019.

The House is expected to soon consider the measure. Earlier, the House rejected the premium subsidy when it was part of a broader bill that many House Democrats opposed for reasons unrelated to the subsidy.