Is continuous coverage required?
No. Anyone who meets the eligibility requirements and is within their eligible COBRA period (generally 18-months) is eligible for a second election period and may receive a subsidy. This includes: Individuals that enrolled in COBRA and paid premiums monthly. Individuals that enrolled in COBRA but either did not pay premiums or have since dropped COBRA […]
If a person is already receiving a subsidy from an employer, does it preclude them from receiving the COBRA government subsidy?
The COBRA government subsidies are based on the amount the AEI is responsible for. If coverage is already being subsidized, it would not also receive a government subsidy. Employers should consider this when arranging future severance packages.
If an individual has access to coverage through a spouse, but there is an additional charge, can they enroll through the subsidy?
Current guidance indicates that if an individual has access to another group plan, they would not be eligible for a subsidy.
If an individual was given notice of a layoff but resigns prior, would that be considered a voluntary or involuntary term regarding the subsidy?
There has not been clear guidance on the definition of voluntary vs. involuntary termination. Plan sponsors must use their best judgment when identifying assistance eligible individuals. If eligibility is in question, Plan Sponsors may want to take a cautious position and include the individual in the list of AEIs.
If someone is eligible for Medicare, will they be eligible for a subsidy for dental and vision coverage?
At this time, individuals who are eligible for Medicare do not appear to be eligible for any subsidy.
I am currently enrolled through the Individual Marketplace, but I am potentially an AEI. Can I switch to COBRA continuation coverage with premium assistance?
Yes. Individuals can use the election period to change from the marketplace to COBRA continuation coverage.
If someone was eligible back to 11/1/2019 and did not elect coverage when first eligible, can they go all the way back to 11/1/2019 for an effective date?
An individual will need to be in their original election period (including the Pandemic Relief Periods) in order to have continuous coverage. Pandemic Relief Periods end the lessor of 12 months from the original effective date or 60 days following the end of the Pandemic period. Therefore, an individual effective on 11/1/2019, would no longer […]
If an individual did not have health care before, are they eligible for the subsidy?
Eligibility for the subsidy is based on the coverage that was in place at the time of the original qualifying event. If health coverage was not included, they are not able to elect it now.
If an employee is on COBRA due to a leave, would they be eligible for a subsidy?
A leave would generally fall under the reduction of hours provision and the individual would likely be eligible for the subsidy.
Do plan sponsors need to offer a subsidy for terminations due to gross misconduct?
No. If an employer would not have otherwise offered COBRA, the Plan Sponsor is not required to offer the subsidy.
Who is eligible for a subsidy?
A subsidy must be offered to all employees and dependents who experienced a loss of coverage due to involuntary termination or reduction of hours and are within their eligible COBRA period. Individuals who voluntarily termed employment, who are eligible for Medicare or eligible for any other Group Health Plan are not eligible. Check out our […]
What is the subsidy period? When will it end?
The subsidy period begins on April 1, 2021 through September 30, 2021. An individual will no longer be eligible for a subsidy if the individual becomes eligible for other group coverage or when the original COBRA coverage period is set to expire.
What benefits are eligible?
There is a subsidy for 100% of premiums (including 2% administration fees) for the cost of Group Health Plans, including: Medical, Dental, Vision, and most HRAs. The subsidy is available for both fully insured and self-insured plans. Flexible Spending Accounts are not eligible for subsidy.
