From the Office of Senator Kerry

Thursday, March 14, 2002

Washington, DC – Senators Jon Corzine (D-NJ) and John Kerry (D-MA) today led efforts to include healthcare provisions in the Trade Adjustment Assistance bill (TAA) that the Senate will take up in the coming weeks. Thirty-five Senators joined Kerry and Corzine on the letter to majority leader Tom Daschle.

Senator Kerry said, "Giving lipservice to the needs of American workers and then failing to provide real help in meeting the sky-high costs of healthcare is an insult to hard-working Americans who have lost their jobs through no fault of their own," said Senator Kerry. "We have an obligation to make sure that workers can maintain affordable, quality health care coverage for themselves and their families. When it comes time to consider trade legislation, these important and bipartisan health care proposals must be at the center of our debate."

"Regardless of whether you support or oppose fast-track trade authority, affordable, meaningful healthcare is a necessary part of assisting working Americans who are displaced as a result of international trade agreements," said Senator Corzine. "To provide COBRA health care coverage at prices that American workers cannot afford is about the same as providing no assistance at all."

COBRA continuation coverage has been an option for laid-off workers since 1986. However, the coverage is prohibitively expensive. COBRA premiums average $600 per month and can be as high as $1,000 per family.

As reported out of the Senate Finance Committee earlier this week, TAA (S.1209) includes the COBRA subsidy the Senators are advocating. Under the COBRA provision, workers would be responsible for paying just 25% of their COBRA premium. This would account for about 16% of the average TAA unemployment benefit. The remaining 75% of the cost would be reimbursed by the federal government.

Conversely, under the 50% tax credit proposed by Republicans during the stimulus debate last fall, most families would have to spend one third of their TAA benefits on health care. Even with a 60% subsidy, a family's share of the premium would represent 25% of the average unemployment benefit under TAA.

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