The American Rescue Plan Act requires a 100% COBRA/continuation of coverage premium subsidy to be provided to individuals entitled to COBRA/continuation coverage under federal COBRA or state mini-COBRA due to reduction of hours or involuntary termination of employment. To be eligible for the subsidy, the qualified beneficiary must have a qualifying event that is a reduction in hours or involuntary termination of employment, elect COBRA/continuation coverage, elect to be considered an assistance-eligible individual, and not be eligible for other group health coverage or Medicare.
Employers should have already communicated information about the premium subsidy and how to elect to be treated as an assistance eligible individual. This prior communication is not the end of an employer’s notice obligations.
The Department of Labor requires an individual to be notified 15-45 days before their ARP COBRA premium subsidy is expiring. This notice must be sent before the September 30, 2021 end of the subsidy period, and must also be sent when an individual’s maximum COBRA/continuation coverage period is ending. This could be at the end of the 18/29/36 months of COBRA or upon the expiration of the state mini-COBRA coverage.
Employers who use Cobra Control Services for COBRA notice obligations should rest assured that CCS tracks expiration of coverage and will send the required notices on the employer’s behalf.