Congress gives final approval to trade bill boosting health insurance premium subsidies
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WASHINGTON—The House of Representatives has approved and sent to President Barack Obama trade legislation that includes a provision boosting federal health insurance premium subsidies for employees who lose their jobs due to foreign competition and older retirees in failed pension plans.
The Health Coverage Tax Credit is part of the Trade Adjustment Assistance Reform Act of 2002.
Federal lawmakers originally set the subsidy as a 65% federal tax credit. In 2009, an economic stimulus law raised the credit to 80% through Dec. 31, 2010. Last year, Congress approved a temporary extension through Feb. 13. The subsidy reverted to 65% after lawmakers in February could not agree on another extension.
The House gave final approval to H.R. 2832 on Wednesday, and the Senate has already approved the measure, which would raise the tax credit to 72.5% until 2014.
The administration supported the bill and President Obama is expected to sign it.
Aside from those who lose their jobs due to foreign competition, the subsidy also would be available to those at least age 55 whose pension plans have been taken over by the Pension Benefit Guaranty Corp.
Under a system implemented by the Internal Revenue Service, the beneficiary pays 35% of his or her premium to the government. The IRS then remits the full amount to the health plan or plan administrator.
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Health insurance subsidy reverts to 65%
WASHINGTON—A law that provided greater federal health insurance premium subsidies, such as COBRA coverage, to workers who lose their jobs due to foreign competition and older retirees in failed pension plans has expired due to congressional inaction.
