Subsidy For COBRA Due To The American Rescue Plan

Do any of your employees qualify for a subsidy for their COBRA due to the American Rescue Plan?

What you need to know about how the American Rescue plan impacts group health and COBRA

Under Section 9501 Preserving Health Benefits for Workers, a temporary subsidy is being offered to offset the cost of COBRA and Cal-COBRA coverage for qualifying individuals who lost employer-sponsored health coverage due to involuntary termination or reduction in hours.

Assistance-eligible individuals will be required to pay $0 for COBRA/Cal-COBRA premiums for qualifying coverage months between April 1, 2021 and September 30, 2021.

Your health insurance carrier should have sent you or your broker a list of clients to review and confirm whether their COBRA election in 2021 was a voluntary termination or an involuntary termination.

Those notices should have include additional details on subsidy criteria and provide information on how qualified individuals can enroll. As a general rule, employer groups and or their COBRA administrators are responsible for meeting notice obligations under Federal COBRA.