COBRA Subsidies Available Under ARPA

The American Rescue Plan Act (ARPA) coronavirus relief bill includes COBRA subsidies for employees who qualify for or could have qualified for COBRA coverage (due to involuntary termination of employment or a reduction in hours) from April 1-September 30, 2021. Employers will be able to claim federal tax credits for the subsidized COBRA premiums. Below is a chart to help employers identify what type of notification to provide eligible employees, with links to USDOL model notices.

 COBRA SUBSIDY COVERAGE PERIOD AND NOTIFICATION UNDER ARPA 

 

Employee is eligible for “no cost” COBRA coverage from:

Election notice required 
(links to USDOL model notices provided)

 

 

Expiration notice required (links to USDOL model notices provided)

If employee was receiving COBRA prior to April 1:

April 1 - Sept. 30, 2021, or end of eligibility coverage period, whichever comes first

COBRA Continuation Coverage Notice in Connection with Extended Election Periods; Plan Administrators should also include the Summary of the COBRA Premium Assistance Provisions under the American Rescue Plan Act of 2021

Notice of Expiration of Period of Premium Assistance, at least 15 days before, but no earlier than 45 days before, subsidy expires. 

If employee qualified to receive COBRA prior to April 1, 2021, but previously declined, or elected then terminated coverage, and is still within their eligibility period:

 

April 1 - Sept. 30, 2021, or end of eligibility coverage period, whichever comes first

COBRA Continuation Coverage Notice in Connection with Extended Election Periods, by May 31, 2021; employee has 60 days from receipt to elect subsidized coverage.

Plan Administrators should also include the Summary of the COBRA Premium Assistance Provisions under the American Rescue Plan Act of 2021

Notice of Expiration of Period of Premium Assistance, at least 15 days before, but no earlier than 45 days before, subsidy expires. 

If employee is eligible to receive COBRA beginning April 1, 2021:

April 1 - Sept. 30, 2021

General Notice and COBRA Continuation Coverage Election Notice; Plan Administrators should also include the Summary of the COBRA Premium Assistance Provisions under the American Rescue Plan Act of 2021

Notice of Expiration of Period of Premium Assistance, at least 15 days before, but no earlier than 45 days before, subsidy expires.