Employers subject to federal COBRA had to give certain qualified beneficiaries a second chance to elect COBRA continuation coverage. Individuals whose qualifying event was a reduction of hours or involuntary termination of employment and would still be in their 18-month COBRA period as of April 1, 2021 had they (a) elected COBRA continuation coverage and/or (b) not dropped COBRA continuation coverage have a “second chance” to enroll in coverage. This new enrollment may be for a date on or after April 1, 2021, assuming the initial COBRA duration period has not ended. If COBRA continuation coverage is elected, it may be provided at $0.00 if the qualified beneficiary meets the requirements of the American Rescue Plan Act to be considered an assistance eligible individual.
Employers were required to notify the applicable population of the second chance COBRA opportunity. BAS sent the required notification for employers who engaged BAS’ Cobra Control Services for COBRA administration and who completed CCS’ request for information about the voluntary/involuntary status of qualifying events by the communicated due date.
The notice to eligible individuals included forms provided by the U.S. Department of Labor through model notices. The package contained (a) information about the second chance election; (b) a COBRA election form; (c) a form to request to be treated as an assistance eligible individual; (d) a form to change plans (if permitted by the employer); (e) a form to notify CCS if the individual should no longer be considered a subsidy-eligible individual.
Recipients of the letter may have questions about the package they received.
Question: Why did I get this package? I don’t have COBRA coverage.
Answer: The package was required to be sent to you because if you had elected COBRA coverage (or if you had not dropped your COBRA coverage), you would still be in your COBRA period. You now have a second chance to elect COBRA, for a limited period of time, at a $0 rate.
Question: Why did I get this letter? I already have COBRA coverage.
Answer: The package was required to be sent to you to tell you about the opportunity for your COBRA premium to be reduced to $0.
Question: I have COBRA coverage now and I want the free COBRA coverage. What do I do?
Answer: You can get subsidized COBRA coverage only if you meet the requirements of an assistance-eligible individual. This means that your COBRA qualifying event was a reduction of hours or involuntary termination of employment and you are not eligible for any other health coverage or Medicare. If you meet these requirements, you must complete and return the form Request For Treatment As An Assistance Eligible Individual.
Question: I have COBRA coverage now but since I am eligible for another plan, I can’t get the COBRA subsidy. What do I do?
Answer: You don’t have to take any action if you don’t want to (or can’t) be considered for the COBRA subsidy.
Question: I have COBRA coverage now and I want to switch plans. What do I do?
Answer: You may switch plans only if permitted by your employer. If your employer allows you to switch plans, you must complete and return the COBRA Change Form included in your package. If there is no such form in your package, your employer does not allow you to change plans.
Question: I don’t have COBRA coverage and I don’t want it. What do I do?
Answer: You do not have to take any action if you don’t want COBRA coverage.
Question: I don’t have COBRA coverage but I want it now. What do I do?
Answer: You will have to complete and return the COBRA election form to get COBRA coverage. You must indicate the date you want your second-chance COBRA to start. If you want your continuation coverage to be $0 for the subsidy period, you must complete and return the form Request for Treatment As An Assistance Eligible Individual. You may get subsidized coverage only if you meet the requirements of an assistance-eligible individual. This means that your qualifying event was a reduction of hours or involuntary termination of employment and you are not eligible for any other health coverage or Medicare.
Question: There are so many forms in the package. What do they all mean and what do I have to do with them?
Answer: Here is a summary of the forms:
- COBRA Election Form. Use this form if you are not currently continuing coverage under COBRA but you now want to start COBRA coverage through this second-chance election.
- Request For Treatment As An Assistance Eligible Individual. This form must be completed if you want to be considered for subsidized ($0 premium) COBRA coverage. You will not get subsidized coverage unless this form is completed and returned to CCS.
- COBRA Change Form. This form is included in your package only if your employer allows you to switch to a different plan option. If you want to change plans from the plan in which you were enrolled at the time of your qualifying event, you must complete and return this form. If your employer does not allow you to switch to a different plan, this form will not be part of your package.
- Participant Notification. This is the form you will send to Cobra Control Services when you are no longer eligible for subsidized coverage. You must complete and return this form as soon as you become eligible for other health coverage or Medicare. If you do not return this form to cancel your COBRA subsidy, you may be subject to tax penalties.