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Reminder: Upcoming Deadline to Provide COBRA Subsidy Expiration Notice

The American Rescue Plan Act of 2021 (the “ARPA”) provides a 100% COBRA premium subsidy (the “COBRA Subsidy”) to certain COBRA qualified beneficiaries, which we previously reported on here, here, and here. Under the ARPA, the COBRA Subsidy is set to expire on September 30, 2021. The APRA requires that certain notices be sent to affected qualified beneficiaries regarding the COBRA Subsidy, including a notice of the upcoming expiration of their premium assistance. This expiration notice must be sent no fewer than 15 days and no more than 45 days before an individual’s COBRA Subsidy expires. The DOL has released a model “Notice of Expiration of Period of Premium Assistance” that plans may use to satisfy the notice requirement. Because the COBRA Subsidy is set to expire on September 30, 2021, the deadline to send out the expiration notices is quickly approaching. Employers are reminded to contact their third-party COBRA administrators,… Continue Reading

IRS Issues Additional Guidance Regarding COBRA Premium Subsidy

As we previously reported here, the American Rescue Plan Act of 2021 (?Ç£ARPA?Ç¥) provides a 100% COBRA premium subsidy to any qualified beneficiary who is entitled to COBRA coverage due to an involuntary termination of employment or reduction in hours of employment. Employers will receive a tax credit for the cost of COBRA premiums for April 1 to September 30, 2021. The IRS recently issued FAQs addressing many issues related to the subsidy, including: (i) subsidy eligibility, (ii) what qualifies as a reduction in hours or an involuntary termination of employment, (iii) the type of coverage eligible for the subsidy, (iv) when the subsidy period begins and ends, (v) the extended election period, (vi) coordination with the extended deadlines due to the COVID national emergency (?Ç£Outbreak Period Extensions?Ç¥), (vii) payments to insurers, (viii) application to state continuation coverage, and (ix) calculation and claiming of the subsidy tax credit. One of… Continue Reading

COBRA Premium Assistance FAQs and Model Notices Issued

The DOL?áissued new model notices that may be used in connection with COBRA premium assistance requirements under the American Rescue Plan Act of 2021 (?Ç£ARPA?Ç¥). These model notices include (i) an ARPA General Notice, (ii) a Notice in Connection with Extended Election Periods, (iii) an Alternative Notice, and (iv) a Notice of Expiration of Period of Premium Assistance. The DOL also issued a Summary of ARPA requirements, which the DOL states should be included with the ARPA General Notice, the Alternative Notice, and the Notice in Connection with Extended Election Periods. Use of the model notices is not required. The ARPA General Notice (or its equivalent) should be sent to each COBRA qualified beneficiary (?Ç£QB?Ç¥) who experiences a COBRA qualifying event from April 1, 2021 through September 30, 2021. The FAQs issued in conjunction with the model notices state that the ARPA General Notice must be sent only to those… Continue Reading

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