How the American Rescue Plan Act of 2021 Affects COBRA
The American Rescue Plan Act (ARPA / HR 1319) signed into law by President Biden is designed to subsidize up to six months of COBRA coverage for former—or current—employees that have lost or will lose coverage. From April 2021 to September 2021, these employees can be relieved of some of this financial burden.
It is important to note that EMPLOYERS are required by ARPA to notify all eligible employees (including those no longer employed that previously waived COBRA participation) of their subsidy eligibility. At benefEx, we’re eager to help you navigate COBRA, so you are in compliance with ARPA. Keep reading to learn more!
How to Navigate COBRA Premium Assistance
To start, we strongly encourage our clients to begin gathering data from November 1, 2019, forward.
All individuals whose employment terminated (or who lost benefit eligibility due to a reduction in hours) at any point since November 1, 2019, may qualify for this subsidy.
Offers of COBRA premium assistance to eligible employees must be made by the employer or by a third-party administrator on behalf of the employer. They will provide you with what you need to comply with this new ARPA law.
Choose the Right COBRA Provider
We can help you select the right COBRA provider for your unique circumstances.
If you already have a COBRA administrator, complications that the ARPA requirements may present can be minimized with professional assistance from benefEx. We are experienced, easy to work with, and eager to help you through how the American Rescue Plan act of 2021 may affect your COBRA.
Administration for the American Rescue Plan COBRA premium assistance depends on factors as follows:
- Type of termination
- Type of medical plan offered
- Size of the group covered by the plan
Things to Consider
Keep in mind; this ARPA COBRA subsidy includes employees who will lose (or have lost) coverage due to RIH.
Reduction in hours of work can drop your employees below the qualifying level to receive insurance benefits coverage. Your company will also need to notify any such employees of their eligibility for this subsidy.
Let Us Help You Navigate COBRA and the American Rescue Plan
At benefEx, our mission is to bring freedom of choice back to employee benefits and healthcare. We are ready to work together to help you meet the arduous demands of ARPA. Feel free to reach out to us with ANY questions.