| The American Reinvestment & Recovery Act ("ARRA") - Model COBRA Notices Now Available By Sally Piefer The American Reinvestment & Recovery Act ("ARRA") provides for premium reductions and additional election opportunities for health benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"). Eligible individuals pay only 35% of their COBRA premiums and the remaining 65% is paid by the employer, but reimbursed through a tax credit.
The premium reduction applies to periods of health coverage beginning on or after February 17, 2009 and lasts for up to nine months for those eligible for COBRA during the period beginning September 1, 2008 and ending December 31, 2009 due to an involuntary termination of employment that occurred during that period.
Employers are required to notify certain current and former participants and beneficiaries about the premium reduction. Model notices are now available to help employers comply with these requirements. You should check with your group health insurer to determine whether the carrier will provide the notices or whether your company will be responsible for providing the notices. Each notice is designed for a particular group of qualified beneficiaries and contains information to help satisfy ARRA's notice provisions.
Notice Downloads (PDF) Copies of the Model Notices can be downloaded below. You will need to tailor the Notices for your specific plans. Please consult with legal counsel to ensure your Notices are appropriate for your company.
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