August 16, 2021 Required Dissemination of ARPA COBRA Premium Assistant Expiration Notices
KEEPING YOU INFORMED…
We are writing to remind you about an upcoming notification deadline in accordance with the American Recovery Plan Act of 2021 (“ARPA”). As we advised in our April 27, 2021 Memorandum, the ARPA requires employers, and their group health plans, to offer 100% subsidized COBRA continuation coverage to “Assistance Eligible Individuals” (“AEIs”) between April 1, 2021 and September 30, 2021. With the end of this fully-subsidized coverage soon approaching for most AEIs, we are writing to remind you of your obligation to notify all AEIs of the impending expiration of their fully-subsidized COBRA assistance.
Employers may use the U.S. Department of Labor’s model Notice of Expiration of Premium Assistance to satisfy its notification obligation. This notice informs AEIs of the date on which their premium assistance will expire, and it, or an equivalent notice of your choice, must be distributed to AEIs 15-45 days before their subsidy expires (not earlier or later). This notice must also provide information concerning the AEI’s eligibility for coverage without any premium assistance through either COBRA continuation coverage or coverage under a group health plan.
We recommend that you review your AEI subsidy expiration dates and calendar the release of these notifications as applicable to each employee receiving the ARPA COBRA subsidy. Employers who fail to satisfy COBRA continuation coverage requirements may be investigated by the Department of Labor and may be subject to excise tax penalties, pursuant to the Internal Revenue Code, of up to $100 per day per qualified beneficiary (up to $200 daily per family) for each day an employer remains in violation.
If you have questions about complying with the ARPA’s COBRA subsidy requirements, please contact Alyssa Zuckerman (alz@lambbarnosky.com), Michelle Mahabirsingh (mm@lambbarnosky.com) or one of our other attorneys at 631-694-2300.
THIS MEMORANDUM IS MEANT TO ASSIST IN GENERAL UNDERSTANDING OF THE CURRENT LAW. IT IS NOT TO BE REGARDED AS LEGAL ADVICE. THOSE WITH PARTICULAR QUESTIONS SHOULD SEEK THE ADVICE OF COUNSEL.
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© Lamb & Barnosky, LLP 2021