Casey, Brown push to extend COBRA subsidies — with a new offset

A pair of Senate Democrats this week renewed their push to extend health insurance subsidies for the unemployed.

Sens. Bob Casey Jr. (Pa.) and Sherrod Brown (Ohio) are hoping that the latest iteration of their COBRA subsidy bill — which would pay for itself with more than $1 billion to spare — can win support from the budget hawks who have slowed the upper chamber to a crawl over deficit spending concerns.

Under the COBRA subsidy program, created as a part of the 2009 economic stimulus package, laid-off workers pay just 35 percent of their health insurance premiums, with the government covering the rest. The deadline for new enrollment, however, came and went on June 1, leaving more than 140,000 families ineligible each month, according to estimates from the National Employment Law Project, an advocacy group.

The Casey-Brown proposal would extend the enrollment deadline through November, retroactive to June 1. Those entering the program over that time span would be eligible to receive six months of federal help. 

To pay the tab, the lawmakers on Tuesday offered to eliminate a tax break currently available for short-term grantor retained annuity trusts, which are a form of asset transfer. The proposal is estimated to save $5.3 billion — well above the $4.1 billion cost of the COBRA extension. The extra $1.2 billion would be used to pay down the deficit.

Casey and Brown offered their bill as a stand-alone measure in hopes of attaching it to a larger package — perhaps the tax extenders bill that failed in the Senate last week — when Congress returns from the Fourth of July recess next month. A failure to extend the COBRA subsidies, the lawmakers warned, would undermine the country's fragile economic recovery. 

"Now is not the time for more Americans to join the ranks of the uninsured," Brown said in a statement Tuesday.