Under the American Rescue Plan Act of 2021 (ARPA), employees who were involuntarily terminated or had their hours reduced (and who met certain other criteria) became eligible for fully subsidized COBRA coverage from April 1, 2021, through September 30, 2021.
Under ARPA, eligible individuals receiving subsidized coverage must be sent notice when their premium assistance ends. The expiration notice must be sent no less than 15 days and no more than 45 days in advance, and the due date will depend on when an individual’s maximum COBRA coverage period ends.
For individuals whose subsidy is expiring on September 30th, due to the end of the subsidy period, the notice must be sent between August 16, 2021 and September 15, 2021.
Plans are not required to issue an expiration notice to individuals whose subsidy is expiring because they became eligible for other group health plan coverage or Medicare.
The U.S. Department of Labor has prepared a model expiration notice that can be used to satisfy this requirement.
Disclaimer: The information contained in this message is for general informational purposes only and does not constitute legal advice. Employers should speak with their tax advisor on how to properly claim the tax credits.