It’s a 100% subsidy. COBRA Subsidy: Notice of Premium Assistance (Cont.) The American Rescue Plan Act of 2021 (ARPA), referred to as the third COVID stimulus package, took effect in March and extends support to employees through new COBRA … For example, let’s say an individual was terminated in October 2019 and their COBRA eligibility began November 1, 2019. Individuals must be provided with new COBRA election notices by May 31, 2021, and will receive subsidized COBRA coverage effective April 1, 2021… Is enrolled in COBRA as of April 1, 2021, or 2. The Alternative Notice is purposed for those Plans that are subject to state continuation requirements (aka mini Cobra) from April 1, 2021 through September 30, 2021. The DOL guidance about the COBRA premium assistance provisions contained in the American Rescue Plan Act COBRA Premium Subsidy, includes FAQs for employers and employees and model forms. American Rescue Plan Act of 2021 includes a 100% COBRA subsidy for certain individuals for up to a six-month period from April 1, 2021, through September 30, 2021. The federal government will be funding continuing coverage with employers claiming the reimbursement as a payroll tax credit, much like under ARRA, through Form 941. Status changed from full-time to part-time. 1 To get the subsidy, the individual’s maximum COBRA eligibility period must also not have expired as of April 1, 2021. The American Rescue Plan Act of 2021, referred to as the third COVID-19 stimulus bill, provides 100% premium assistance for eligible individuals under COBRA for a … Date: Mar 30, 2021. On Tuesday, 05/18/2021, the Internal Revenue Service (IRS) released IRS Notice 2021-31, which includes additional guidance about the application of the COBRA premium assistance provisions in the American Rescue Plan Act.The guidance includes frequently asked questions (FAQs) about the application of the subsidy in different situations. While the subsidy to so-called COBRA applies to premium costs between April 1 and Sept. 30, employers have until May 31 to make sure everyone knows about it, namely those employees who were laid off before April 1, according to guidance issued by the Department of Labor last week. The newly elected coverage will be retroactive to April 1, 2021, and can last through the end of the individual's normal COBRA coverage period measured in connection with the original qualifying event of an involuntary termination of employment or reduction in hours (although the premium assistance will end no later than September 30, 2021). The subsidy period begins on April 1, 2021 through September 30, 2021. Key Guidance: Notices must be sent by 05/31/2021 The subsidy is available for the period of April 1, 2021 through September 30, 2021, if the individual is not eligible for other group health plan coverage or Medicare. The new COBRA subsidy ($0 COBRA subsidy) is available for periods of coverage starting April 1, 2021 and ending September 30, 2021. AMERICAN RESCUE PLAN ACT OF 2021 | COBRA PREMIUM SUBSIDY. The premium subsidy is available with respect to any premium owed for a period of COBRA coverage beginning on April 1, 2021 and ending on Sept. 30, 2021. How is the subsidy applied? Beginning April 1, the recently passed American Rescue Plan Act of 2021 (“ARPA”) implements temporary, but significant changes to COBRA, including new notices, government subsidies, and second election windows. COBRA Benefit Extensions and Premium Subsidy. The American Rescue Plan Act of 2021 (ARPA), which became law on March 11, 2021, provides a 100 percent subsidy of premiums under the Consolidated Omnibus Budget Reconciliation Act (COBRA) beginning on April 1, 2021, through September 30, 2021, with employers to recoup the missing premiums through Medicare tax credits.. An individual is eligible for the COBRA premium subsidy if he … - AEI 2021 2nd COBRA CONTINUATION COVERAGE ELECTION FORM - AEI Attestation . On April 7, 2021, the Department of Labor issued much needed guidance regarding the new COBRA subsidy, including model ARP COBRA notices and COBRA election forms and Frequently Asked Questions regarding COBRA premium assistance. When the Senate voted to pass the bill, it increased the government's subsidy to 100 percent of COBRA premiums for laid off workers and covered relatives from April 1 through Sept. 30, 2021… AEI 2021 Status Update utility: The AEI 2021 Status Update utility is used to upload Because the maximum subsidy period is set for a specific period of time (April 1, 2021 through September 30, 2021), individuals who have COBRA coverage remaining after the subsidy is exhausted would revert to paying the full premium after the subsidy ends. The COBRA subsidy is available to assistance eligible individuals (“AEIs”) who are COBRA qualified beneficiaries (“QBs”) because of an involuntary termination of employment or a reduction in hours receive a 100% COBRA subsidy for the period of April 1, 2021 – September 30, 2021. The new guidance provides information across several topics and contains 86 questions and answers including: Introduction. Additional guidance, including revised model forms, is expected soon. The subsidy — which pays 100% of COBRA premiums, including the 2% administration fee — is available from April 1 to Sept. 30 to assistance eligible individuals (AEIs). While not exhaustive, the Notice covers a broad range of questions and answers that clarify the … On May 18, 2021, the IRS issued Notice 2021-31, which provides helpful guidance on a number of issues in the form of 86 FAQs. By or before May 31, 2021, notice of the extended election period to AEIs who have a second chance to elect COBRA as of April 1, 2021. — Amount of the subsidy: 100% of the COBRA cost — Length of the subsidy: April 1, 2021,through September 30, 2021 (although subsidy ends when COBRA rights end, or, if earlier, when individual becomes eligible for other coverage) — Methodology of reimbursement: Employer recoups cost of COBRA coverage through In response to the high number of furloughed and laid-off employees as a result of the COVID-19 pandemic, many of whom lost employer-provided medical coverage and then could not afford the high costs of COBRA coverage, Congress included a temporary, 100 percent premium subsidy in ARPA for Assistance Eligible Individuals (AEIs). This notice must be provided no later than May 31, 2021. Any AEI receiving subsidized COBRA coverage. By or before May 31, 2021, notice of the subsidy to individuals who are covered by COBRA during the Premium Assistance Period. This notice is the only notice required for the purposes of informing beneficiaries of their continuation coverage rights and ARP information during the subsidy period. With the signing of the American Rescue Plan Act by President Biden on March 11, 2021, COBRA continuation coverage will be subsidized 100 percent for many … This Client Alert addresses the following issues: 1. If your qualifying event date falls within the subsidy period of April 1 – September 30: - Specific Rights Notice/General ARPA Notice. An AEI for the COBRA subsidy under ARP is a person who is eligible for COBRA continuation coverage due to an involuntary termination or involuntary reduction in hours and: 1. When does the COBRA subsidy end? For example, let’s say an individual was terminated in October 2019 and their COBRA eligibility began November 1, 2019. Other Rights. This includes the extended election period form due May 31, 2021 to those already enrolled in COBRA and eligible for the subsidy, and those who would be eligible for the subsidy if they had elected and/or maintained COBRA. The U.S. Department of Labor released its initial COBRA subsidy guidance as a set of FAQs and model notices on April 7, 2021. On May 18, 2021, the IRS released much anticipated guidance under IRS Notice 2021-31 supplying detailed information on various impl ementation issues related to the COBRA premium subsidy under the American Rescue Plan Act of 2021 (ARPA). The American Rescue Plan Act of 2021 (Act) provides “assistance eligible individuals” with premium assistance in the form of a 100% subsidy … Between 15-45 days before the later of the end of the AEI's COBRA coverage period or September 30, 2021. The law requires employers to update COBRA notices sent to assistance eligible individuals to describe the subsidy and to issue extended COBRA election notices within 60 days of the date of applicability. The Model COBRA Subsidy forms mandated under the American Rescue Plan Act (ARPA) were released today ahead of the deadline. No COBRA premiums will be due from eligible individuals for the six-month period between April and September of 2021. The IRS issued Notice 2021-24, which provides guidance following the passage of the American Rescue Plan of 2021 (ARPA).The Notice provides information regarding the applicable penalty relief available to an employer under the ARPA for failing to pay employment taxes in anticipation of a credit for COBRA premium assistance paid to assistance-eligible individuals. A temporary subsidy that would have made it affordable for people to stay in their existing ESI plan through the end of 2020 seemed sensible. The Employee Benefits Security Administration (EBSA) issued the forms with sets of FAQs for employers, workers, and their families. If a COBRA qualified beneficiary’s QLE was on Feb 1, 2020, they would still only be eligible for coverage from Feb 1, 2020, until Jul 31, 2021 … With ARRA in 2009, the 941 forms were modified to include space for the credit. USA April 9 2021. The COBRA subsidy ends for everyone on September 30, 2021. 2. Someone who qualifies for the COBRA subsidy is called an Assistance Eligible Individual (AEI). Model Notices. On March 11, 2021, President Biden signed into law the American Rescue Plan Act (“ARPA”), which requires plan sponsors to provide free COBRA coverage from April 1, 2021, through September 30, 2021, to individuals who lose coverage due to an involuntary termination of employment or reduction of hours. hca.wa.gov/cobra-subsidy . In addition to the ability to receive six months of subsidized coverage, an assistance … ... elected for the COBRA subsidy period. ARPA COBRA Subsidy Eligibility: ... AMERICAN RESCUE PLAN ACT OF 2021 (ARPA) SUBSIDY ELIGIBILITY (4/1/2021 to 9/30/2021) Title: Supplemental COBRA Subsidy Eligibility Form … Unlike ARRA, ARPA provides a 100% COBRA premium subsidy for only a six-month period, from April 1, 2021 to September 30, 2021. After the subsidy ends on September 30, 2021, the employee could continue to pay for coverage until November 30, 2021 (the end of the original COBRA 18-month period). In order to extend your health coverage beyond March 31, 2021, you must complete a COBRA election form and send it back to the Fund Office by the due date listed on the election form. Issue Date: April 22, 2021. One area of particular interest to employers is how they get reimbursed for the subsidies they are required to provide. The subsidy does not extend an eligible individual’s maximum period of continuation coverage. Below is a summary of these changes and what they mean for your employees and your company. For more information, please refer to our prior Client Alerts on the new COBRA subsidy which may be accessed here and here . For premiums an employer pays as part of the COBRA subsidy for the period July 1, 2021 through September 30, 2021, it should report the payments and the corresponding credit on the Form 941 it files for the third quarter of the year. Individuals must be provided with new COBRA election notices by May 31, 2021, and will receive subsidized COBRA coverage effective April 1, 2021… An AEI for the COBRA subsidy under ARP is a person who is eligible for COBRA continuation coverage due to an involuntary termination or reduction in hours and: Is enrolled in COBRA as of April 1, 2021, or. Please note: the subsidy also applies to anyone whose 18-month federal COBRA eligibility period includes April 1, 2021.

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