April 07, 2021
As most of you may be aware, the American Rescue Plan Act (ARPA) provides a 100% subsidy of COBRA premiums from April 1, 2021 – September 30, 2021 (this includes medical, dental and vision coverages). The subsidy is available to employees and their family members who lost health insurance due to an involuntary termination or a reduction in hours (but not in the event of a voluntary termination of employment, retirement or death).
This morning, the Department of Labor’s Employee Benefit Security Administration (EBSA) released anxiously awaited guidance to assist employers, COBRA administrators, and health care insurers in complying with ARPA’s subsidy requirements.
Any COBRA continuation coverage elected by an eligible individual is a prospective election and coverage will start with the first period of coverage beginning on or after April 1, 2021. However, coverage will not extend beyond the maximum continuation period for the triggering event.
We recommend that employers and COBRA administrators adopt the language in the model notices as-is.
The following information was also released:
For additional information, please contact your Burnham Consultant or Burnham, A Baldwin Risk Partner at 949‐833‐2983 or email@example.com.
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