Congress Decides to Extend Jobless Benefits Deadline

Congress voted April 15 2010 to roll forward the last day for jobless claimants to file for extended unemployment benefits till June 2 2010, a law President Barack Obama immediately signed into law.

This law will restore federal unemployment benefits to over 200,000 jobless Americans would have been ineligible for them starting April 5.

Before the amendment, federal unemployment benefits, which last up to 73 weeks, commence after 26 weeks of initial coverage expire. Benefits are divided into tiers, and jobless applicants must apply for these benefits each time they move into a new tier.

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The amendment extends several provisions until the end of May, including: COBRA health insurance; the National Flood Insurance Program and the copyright license for providers of satellite television. More importantly, it will prevent the reduction of payment of 21% in Medicare payment rates for doctors from kicking in until May 31.

Republicans in the Senate have resisted extending unemployment benefits, saying the benefit must be paid for, though this bill has enjoyed a lot of bipartisan support.

In the United States, about over 11 million people are receiving unemployment benefits, with about 6 million of them enjoying extended benefits.

Though the economy is expected to slowly improve, the unemployment rate still remins at 9.7%, and the projected average unemployment period for an unemployed worker in America is 31.2 weeks.

Previously, the state had already passed two short-term extensions of the filing deadline since late December. Furthermore, both House and Senate committees also have passed bills that is pushing back the deadline to file for extended benefits until later in the year, but those measures need to be reconciled.

However, there is a problem.

Currently, of the 50 states, about 33 states and the US Virgin Islands have used up their jobless benefits funds and are forced to borrow from the Federal government to the tune of a whopping $38.7 billion to provide a temporary safety net to millions of jobless claimants.

States are going as far as cutting as much extraneous services as they can to keep afloat. From unnecessary entertainment to transport, these cash-strapped cities are eliminating all kinds of services.

Among all states, California has borrowed the most from the government, totaling more than $8.4 billion, followed by Michigan and New York, which have loans worth more than $3 billion. Nine other states have borrowed at least $1 billion from the federal government.

"The nation's financing system for jobless benefits is under unprecedented stress," said Andrew Stettner, deputy director of the New York-based advocacy group for the unemployed. "While the recession has certainly made things worse, this funding crisis has been developing for years."

At the onset of the recession, only 19 states met the recommended funding level, which is one year of reserves equal to the highest amount of unemployment insurance paid out during prior recessions.

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