On April 7, the U.S. Department of Labor (DOL) issued the first set of agency guidance in the form of Frequently Asked Questions (FAQs) and model notices regarding the 100% COBRA premium subsidy (Subsidy) provided for under the American Rescue Plan Act (Act). As detailed in our prior alert, the Subsidy is available to employees whose COBRA qualifying event was an involuntary termination of employment or reduction in hours, and to the spouses and dependents of such employees (Assistance Eligible Individuals), for the period beginning April 1, 2021, and ending on the earliest of (i) September 30, 2021; (ii) the end of their COBRA coverage period; or (iii) the date they become eligible for another group health plan or Medicare. The FAQs clarify the time period within which plan administrators must provide the applicable notices and the time period within which Assistance Eligible Individuals can elect COBRA continuation coverage subject to the Subsidy. The model notices vary, as is more fully explained below, depending on the specific circumstance for which they are being provided.
If you need assistance understanding how the Subsidy impacts plan administration and what revisions should be made to your COBRA notices and administration, or if you have any other benefits questions, please reach out to any of the attorneys in Day Pitney's Employee Benefits and Executive Compensation group.
For more Day Pitney alerts and articles related to the impact of COVID-19, as well as information from other reliable sources, please visit our COVID-19 Resource Center.
COVID-19 DISCLAIMER: As you are aware, as a result of the COVID-19 pandemic, things are changing quickly and the effect, enforceability and interpretation of laws may be affected by future events. The material set forth in this document is not an unequivocal statement of law, but instead represents our best interpretation of where things stand as of the date of first publication. We have not attempted to address the potential impacts of all local, state and federal orders that may have been issued in response to the COVID-19 pandemic.
Day Pitney Press Release