COVID-19 National Emergency Changes COBRA coverage
The COVID-19 national emergency has sent the nation’s unemployment numbers through the roof. Millions of Americans are losing wages and access to health insurance in record numbers. The Federal COBRA Act allows workers to remain on their employer-sponsored group health plans if they would leave their job, are laid off or have hours reduced that would stop their coverage.
In response to the pandemic, the federal government has issued changes to the deadlines that employers have to notify workers of their right to elect COBRA continuation coverage.
When Is COBRA Premium Assistance Available?
Individuals may be eligible for premium assistance if they are eligible for and elect COBRA continuation coverage because of their own or a family member’s reduction in hours or an involuntary termination from employment. This premium assistance, which pays on your COBRA insurance premiums, is available for periods of coverage after April 1, 2021 through September 30, 2021.
Your COBRA premiums will be directly reimbursed to the plan administrator or the third-party insurance administrator from April 1, 2021 through September 30, 2021. If your COBRA would have ended previous to April 1, you are not eligible for this subsidy. If you have any questions, you should contact your COBRA plan administrator.
Additional questions and answers can be found in this memo (PDF file) from the Department Of Labor.
If you qualify for COBRA Premium Assistance and were not given a notification, you may fill out this form and mail it to your plan administrator.
Additional Employer Responsibilities For COBRA During The Pandemic
The following are orders issued by the DOL and IRS:
- An employer’s COBRA plan administrator will now have a 14 day time period to send COBRA election notices after a qualifying workplace event (losing your job, getting laid off, enrolling in Medicare). Under regular COBRA, businesses would have 45 days to make a notification.
- The new COBRA election period is now 1 year since notification of benefits or up to 2 months after the end of the outbreak period, which ever is earlier.
- Your health care coverage is in effect for the duration of the outbreak period, rather than being limited to 18 months. After a qualifying event, you may elect to choose different coverage.
- COBRA premiums for each month of coverage is due 30 days after the outbreak period. You should make monthly premium payments as you will be responsible for everything, that the government is not subsidizing, after the outbreak period.
COBRA Applies To Businesses With 20 Or More Employees
Some American workers of small businesses are left holding the short straw. The COBRA Benefits in the American Rescue Plan only apply to businesses with 19 or fewer employees, unless they operate in a state with Mini-COBRA laws.
Private health insurance marketplaces, like COBRAInsurance.com, have affordable short-term medical policies available to cover any gaps in your health insurance. You can get a quote with a licensed agent or register online to compare plans.
Dates Of The Pandemic Outbreak Period
The Internal Revenue Service (IRS) and the Department of Labor (DOL) have defined the current coronavirus “outbreak period” as starting March 1, 2020 until 60 days after the COVID-19 National Emergency ends. During this period, the timeline has changed for employers and workers in regards to continuing their health insurance coverage.
Changes In COBRA Election Timeline During The Pandemic
Under the Department of Labor’s EBSA Disaster Relief Notice 2021-01:
Individuals and plans with timeframes that are subject to the relief under the Notices will have the applicable periods under the Notices disregarded until the earlier of (a) 1 year from the date they were first eligible for relief, or (b) 60 days after the announced end of the National Emergency (the end of the Outbreak Period). On the applicable date, the timeframes for individuals and plans with periods that were previously disregarded under the Notices will resume. In no case will a disregarded period exceed
This means you have 1 year from being notified of your COBRA election option to make a decision. When the National Outbreak Period ends, you will have up to two months after that end date to enroll for COBRA benefits.
As an example:
- If your COBRA election deadline was by March 1, 2020, you may elect COBRA until February 28, 2021.
- If your COBRA election deadline was by March 1, 2021, you may elect COBRA until February 28, 2022 – unless the National Outbreak Period ends prior to Febraury 28, 2022 – then you have two months from that date to elect coverage.