COBRA Subsidies Are Coming to an End: Here’s What You Need to Do

By: Lyndsey Barnett and Liam McMillin

The end of summer is (sadly) just around the corner. I know, it feels like we just finally got out of the house for the first time a week ago, but before we know it, the kids will be back in school, the days will start getting shorter, and the leaves will be changing colors.

As the summer ends, so do the COBRA premium subsidies under ARPA. While the “Back-to-School” sales and the looming NFL season tell us that summer is coming to a close, employers themselves have to give notice to anyone receiving these COBRA subsidies that their subsidies are expiring. The COBRA premium subsidies expire on September 30, 2021.The guidance on these subsidies has been continuous since the enactment in March 2021, and we’ve been keeping you updated from the beginning, gone into depth on the model notices, and discussed subsequently issued FAQs.

An assistance eligible individual was able to receive the COBRA subsidy until the earlier of: (i) September 30, 2021, (ii) the end of their maximum COBRA period; or (iii) until they become eligible for another group health plan or Medicare.  ARPA requires that all subsidy recipients be provided notice of the expiration of their subsidy and least 15 days but not more than 45 days prior to the expiration, which means all subsidy recipients with subsidies expiring on September 30th will need to receive a notice between August 16th, and September 15th, 2021.  If the individual’s COBRA subsidy ends prior to September 30th due to their maximum COBRA period ending, the notice must be provided at least 15 but not more than 45 days before the expiration of the subsidy (i.e., by August 16th for coverage ending August 31st). If the individual’s COBRA subsidy ends because they become eligible for coverage under another group health plan or Medicare, notice is not required.

The DOL has provided a model notice, which you can find here. Under ARPA, the notice needs to contain specific information to be effective, so it’s important to make sure that the notice isn’t just sent at the right time, but that it contains the right information.

We may not be ready for summer ending, but your Graydon benefits attorneys are ready to help you navigate the end of the COBRA premium subsidies. Give us a call.

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