EBSA releases model notices for 100% COBRA premium subsidy

June 2021 employment law letter

Authors:

Kiran Griffith and Maggie E. Hayes, Perkins Coie LLP

The American Rescue Plan Act of 2021 (ARPA) provides a 100% federal subsidy for COBRA premiums from April 1 through September 30, 2021, for certain COBRA participants known as assistance-eligible individuals (AEIs). We recently outlined the key ARPA provisions and flagged many open questions about how employers and plans should implement and ensure compliance with the new requirements (see “ARPA offering 100% COBRA subsidy through September 2021” in our June 2021 issue). Subsequently, the U.S. Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) issued clarifying guidance about the subsidies as well as a companion notice. Collectively, the guidance helps to resolve some questions, but not all. We expect additional guidance to be issued soon by the IRS and the U.S. Treasury Department.

Model notices

As expected, the COBRA subsidy guidance included the following models, which employers and plans can use to satisfy their ARPA notice obligations:

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