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12 TortSource 1 (2009-2010)

handle is hein.journals/tortso12 and id is 1 raw text is: Vol. 12, No. 1 COBRA Subsidies under the Recovery Act: Bridging the Gap Sacha Steinberger 'i ie nation's unemployment rate nears 10 percent, terminated and unemployed -r.(s' access to health care is increasingly precarious. On February 1-7, 2009, kresicdt Barack Obama signed the American Recovery and Reinvestment Act of 2009 (Recovery Act), Pub. L. No. 111-5, which contains a host of potential eco- nomic stimulus measures. Among those is a temporary COBRA premium subsidy for eligible terminated employees that provides critical monetary assistance for peo- ple who are out of work. An overview of the basic provisions of the subsidy as set forth by the Recovery Act, IRS Notice 2009-27 (April 1, 2009), and the Department of Labor is offered here. Under the Recovery Act, employees involuntarily terminated between September 1, 2008, and December 31, 2009, and their qualified family member beneficiaries are eligible for a subsidy of 65 percent of their COBRA premiums for a period of up continued on page 6 Enp yee Becn :ei : Funded Tihrouigh Trusts: AN w Critplt Nancy Pridgen he Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001--1462, the statute governing employee benefit plans, requires employers to fund pension lns through a trust. Employers can choose, but arc not required, to set up a trust to fund any health and welfare benefits they provide. Many employers recognized the potential for a conflict of interest when the same entity responsible for the direct funding of a plan also decides claims for benefits to be paid from the plan and attempted to sidestep the problem by using trusts. As the law developed before 2008, many circuits around the country likewise had come to acknowledge that using a trust provided an additional layer between those responsible for determin- ing benefit claims and those responsible for funding the benefits, at least partially ameliorating concerns about a structural conflict. But then the U.S. Supreme Court issued its decision in MetLe v. Glenn, 128 S. Ct. 2343 (2008), which now requires continued on page 4 c5 .2_ n6 Fall 2009

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