The U.S. Department of Labor today issued guidance implementing the American Rescue Plan’s Continuation of Health Coverage premium assistance provisions to provide full COBRA premium assistance to certain individuals who have experienced a reduction in hours or involuntary termination of employment.
The guidance from the department’s Employee Benefits Security Administration includes documents – prepared in consultation with the Departments of the Treasury and Health and Human Services – to implement these provisions, such as frequently asked questions, model notices and a Federal Register Notice.
COBRA allows employees and their families who would otherwise lose their group health coverage due to certain life events to continue their group health coverage, known as COBRA continuation coverage. The ARP provides a 100 percent premium subsidy – between April 1, 2021 and Sept. 30, 2021 – for individuals whose reduction in hours or involuntary termination of employment makes them eligible for COBRA continuation coverage during this period.
ARP also requires group health plans to provide notices to individuals losing health coverage to inform them about premium assistance that may be available to them. The model notices published today will help group health plans and employers to comply with these new notice requirements and provide important information to individuals as they make critical healthcare choices for themselves and their families.
“The American Rescue Plan provides much-needed relief to U.S. workers as they face critical decisions about their health coverage,” said Acting Assistant Secretary for Employee Benefits Security Ali Khawar. “The guidance and notices issued today will help to inform individuals entitled to the COBRA premium assistance about the assistance available to them.”