COBRA (the Consolidated Omnibus Budget Reconciliation Act of 1985) is the federal law which permits employees (and their dependents) who lose health benefits the right to choose to continue group health benefits in certain situations. Among those circumstances are voluntary or involuntary job loss, reduction in the hours worked, a transition between jobs, and other life events. If a company had 20 or more employees in the preceding year and had a group health plan, then COBRA applies to that company. While you may have lost that job, you can get continuation coverage for a limited time by electing it and paying for the coverage in an amount up to 102% of the cost to the plan. The right is not automatic for employees and an employer must comply with certain notice requirements when a qualified event affects an employee.
However, the federal government has announced a short-term solution to these high costs if you are eligible. Under the American Restoration Plan Act of 2021 (ARPA), premium assistance to help Assistance Eligible Individuals (as defined in ARPA) is available. These individuals are not required to pay their COBRA continuation coverage premiums from April 1, 2021 through September 30, 2021. Instead, the employer or plan to whom the COBRA payments are due receives a tax credit for the amount of the premium assistance. More information may be found at: https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/cobra/premium-subsidy.
COBRA is just one of the federal and state regulations that continue to be affected by, and subject to change during, this pandemic. Leonard Sciolla is ready to help you determine what you are qualified for if you have had a change in workplace status or what you are required to do if you are an employer who must terminate or reduce hours of your workers. To reach one of our employment law attorneys, call us today at (215) 567-1530 or visit us at www.leonardsciolla.com.