American Rescue Plan Act COBRA FAQs

The American Recovery Plan Act includes a temporary COBRA premium subsidy provision. Find answers here.

The American Rescue Plan Act (ARPA), which was recently signed into law, has a temporary subsidy provision designed to help certain individuals enrolled in COBRA or state continuation coverage pay for their continuation health insurance coverage during the COVID-19 pandemic. The COBRA premium subsidy provision provides a temporary 100% premium subsidy between April 1, 2021 and Sept. 30, 2021. The subsidy will end sooner if the individual’s maximum COBRA coverage period ends or if the individual becomes eligible for another group health plan or Medicare, during this 6-month period.

Assistance Eligible Individuals (AEIs) are qualified beneficiaries who lost group health coverage due to involuntary termination or a reduction in hours and who are not eligible for other group health coverage or Medicare. To be eligible, the qualified beneficiary’s current COBRA continuation period must cover some or all of the subsidy period between April 1, 2021 and September 30, 2021. The employer is responsible for identifying AEIs.

The U.S. Department of Labor’s (DOL) COBRA Premium Subsidy page has resources for employers. There is also a frequently asked questions page that may help to answer additional questions.

This process should only be followed when an AEI elects COBRA during the subsidy period. If the member is not currently covered under COBRA, the employer will also need to supply the standard enrollment form in addition to the forms below.

The steps below are only for processing individuals who qualify for the ARPA COBRA premium subsidy (includes new and existing COBRA members) for whom EmblemHealth bills the member directly. Follow the standard process for enrolling individuals in COBRA who are not eligible for the subsidy (e.g., individuals who terminate employment voluntarily). Direct bill to employer groups do not need to submit COBRA subsidy paperwork at this time to EmblemHealth but are advised to keep records of COBRA premium subsidy eligible individuals. EmblemHealth may require these records in future depending upon additional guidance from the IRS on the tax credit process.

  1. The employer group must send each identified individual the applicable model notice and Summary of COBRA Premium Assistance Provisions under the American Rescue Plan Act of 2021 that contains a Request for Treatment as an Assistance Eligible Individual form. These notices are on the U.S. Department of Labor’s COBRA Premium Subsidy page. They contain important information required for accurate processing and record keeping.
  2. Individuals will need to review the subsidy information contained in the notice, and if eligible for the subsidy, complete the COBRA/Continuation Coverage Election Form and Request for Treatment as an Assistance Eligible Individual section of the Summary of COBRA Premium Assistance Provisions under the American Rescue Plan Act of 2021 and return these forms to the employer.
  3. The employer group or broker must send the completed documents listed below for each subscriber eligible for the COBRA premium subsidy as an AEI to their EmblemHealth senior account executive. This includes employer groups working with a third-party administrator. These notices are on the U.S. Department of Labor’s COBRA Premium Subsidy page.

    • COBRA/Continuation Coverage Election Form (included within model notice)
    • Request for Treatment as an Assistance Eligible Individual (included within Summary of the COBRA Premium Assistance Provisions under the ARPA of 2021) 

    Be sure to write the participant’s SSN, DOB, subsidy start and stop dates, and the EmblemHealth group number onto this document to ensure proper processing.

    • EmblemHealth will process these COBRA premium subsidy enrollments and handle the related billing as follows for groups with 20 or more full-time eligible employees (subject to Federal COBRA) For subscribers who are eligible for the COBRA premium subsidy and normally direct billed to the member, EmblemHealth will add/move AEIs to the employer group’s invoice during the subsidy period. This is because the employer group will pay the premium up front during the AEI’s subsidy period (as the employer will be responsible for filing for a federal tax credit on their 2021 quarterly payroll tax filings). During the subsidy period, the subscriber will not receive an invoice for COBRA coverage. Once the subsidy period is over, if the subscriber is still eligible for COBRA continuation coverage, the subscriber will receive an invoice directly for COBRA coverage, as they did prior to the subsidy, and they will be removed from the group’s invoice.
    • Individuals that have already paid their premiums to EmblemHealth during the subsidy period in which they were eligible, will have their premiums refunded by EmblemHealth.

This process should only be followed when an AEI elects state continuation during the subsidy period. If the member is not currently covered under state continuation, the employer will also need to supply the standard enrollment form in addition to the forms below. 

The steps below are only for processing individuals who qualify for the ARPA COBRA premium subsidy (includes new and existing state continuation members) for whom EmblemHealth bills the group directly. Follow the standard process for enrolling individuals in state continuation who are not eligible for the subsidy (e.g., individuals who terminate employment voluntarily). 

1.     The employer group must send each identified individual the applicable model notice and Summary of COBRA Premium Assistance Provisions under the American Rescue Plan Act of 2021.  These notices are on the U.S. Department of Labor’s COBRA Premium Subsidy page.  They contain important information required for accurate processing and record keeping.

2.     Individuals will need to review the subsidy information contained in the notice, and if eligible for the subsidy, complete the COBRA/Continuation Coverage Election Form and Request for Treatment as an Assistance Eligible Individual and return these forms to the employer.

3.     The employer group or broker must send the completed documents listed below for each subscriber eligible for the COBRA premium subsidy as an AEI to EmblemHealth account services.  This includes employer groups working with a third-party administrator. These notices are on the U.S. Department of Labor’s COBRA Premium Subsidy page.

·       COBRA/Continuation Coverage Election Form (included within model notice)

·       Request for Treatment as an Assistance Eligible Individual. (included within Summary of the COBRA Premium Assistance Provisions under the ARPA of 2021 notice)  

Be sure to write the participant’s SSN, DOB, subsidy start and stop dates, and the EmblemHealth group number onto this document to ensure proper processing.

4.     EmblemHealth will process these COBRA premium subsidy state continuation enrollments and handle the related billing as follows for direct bill to employer groups with 19 and under full-time eligible employees:

For subscribers who are eligible for the COBRA premium subsidy and normally direct billed to the employer group EmblemHealth will exclude those AEIs from the employer group’s invoice during the subsidy period.  This is because EmblemHealth will pay the premium up front during the AEI’s subsidy period (as EmblemHealth will be responsible for filing for a federal tax credit). Once the subsidy period is over and if the individual is still eligible for state continuation coverage, the individual will be placed back on the invoice for the group to continue the premium payments.

Employer groups that have already paid their premiums to EmblemHealth during the subsidy period for Assistance Eligible Individuals (AEIs), will have their premiums refunded by EmblemHealth.