On April 7, 2021, the U.S. Department of Labor (DOL) issued FAQs and model notices for the COBRA premium assistance provisions of the American Rescue Plan Act (ARPA). The ARPA provides a 100% subsidy for employer-sponsored group health insurance continued under COBRA and similar state continuation of coverage programs for eligible individuals. The subsidy applies from April 1 through Sept. 30, 2021. The notices and the FAQs appear on a new DOL webpage dedicated to the ARPA COBRA subsidy.
The new model notices released by the DOL are the following:
- Model General Notice and COBRA Continuation Coverage Election Notice: Microsoft Word | PDF
- Model Notice in Connection with Extended Election Period: Microsoft Word | PDF
- Model Alternative Notice: Microsoft Word | PDF
- Model Notice of Expiration of Premium Assistance: Microsoft Word | PDF
- Summary of COBRA Premium Assistance Provisions under the American Rescue Plan Act of 2021 (to be provided with the General Notice): Microsoft Word | PDF
The DOL guidance contains 21 FAQs on topics such as eligibility, application procedure, notice requirements and duration of the subsidy. Notably, the FAQs state that prior federal COVID-19-related relief for plan deadlines does not apply to notices or election periods set forth in the ARPA provisions about the COBRA subsidy. However, an individual may elect COBRA from an earlier qualifying event if the individual is eligible to make that election, including under the extended time frames provided under that relief.
Action Steps for Employers
Employers should familiarize themselves with the newly released FAQs and the required model notices for the COBRA premium assistance provisions of the ARPA. A notice of extended COBRA election period will need to be sent to any Assistance Eligible Individual by May 31, 2021.
If you are currently using an outside COBRA vendor, you should verify with your vendor if they will be sending the appropriate notices or if this is your responsibility.
If you have questions related to this update, please contact your North Risk Partners advisor. Don’t have an advisor? No problem. We’ll help you find one.
This regulatory update is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice.