DOL Relieves Employers by Providing COBRA Subsidy Model Notices
Author: Jessica Webb-Ayer, XpertHR Legal Editor
April 7, 2021
The US Department of Labor (DOL) has provided employers with help regarding time-sensitive notice requirements related to the COBRA subsidies established by the American Rescue Plan Act (ARPA). The DOL created a webpage dedicated to the COBRA subsidy, which includes frequently asked questions and the following model COBRA notices:
- General Notice and Election Notice;
- Notice in Connection with an Extended Election Period;
- Alternative Notice;
- Notice of Expiration of Premium Assistance; and
- Summary of the COBRA Premium Assistance Provisions.
Employers have various timeframes to provide applicable notices to individuals who may be impacted by the COBRA subsidy relief.
The ARPA, which was signed into law in March 2021, covers 100% of the cost of continuing health insurance under COBRA for situations in which an employee has lost coverage under their employer's health care plan because of an involuntary termination or reduction in hours. The COBRA subsidy period lasts six months (from April 1, 2021, to September 30, 2021). The ARPA funds the COBRA subsidies by providing a payroll tax credit.
Individuals who previously declined COBRA coverage, or who had COBRA coverage but then discontinued it, are also eligible to elect the subsidized COBRA coverage.