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Medical Mutual Update: Six-Month COBRA Subsidy Period Effective April 1, 2021

April 16, 2021/in Carrier, Employee Benefits, Legislation, Medical Mutual /by Cornerstone

The American Rescue Plan Act (ARPA) of 2021 was signed into law by President Biden on March 11, 2021. ARPA introduces a COBRA subsidy period from April 1, 2021, to September 30, 2021, which provides full COBRA premium payments for eligible individuals.

For Medical Mutual groups, COBRA Options is allowing groups to flag members that will be eligible for the subsidy. Once groups have flagged their subsidy-eligible members and the Department of Labor model notice has been released, letters will be mailed to those members. For MHS groups, the MHS COBRA vendor TRAVISOFT is updating its system to allow the MHS COBRA team to run reports of individuals who are eligible for the subsidy to supply to groups for confirmation.

COBRA Options and the MHS COBRA team will continue to collect the standard 2 percent administrative fee from groups. Tax credits should be taken for the full premium amount (including the administrative fee). Members should keep paying their COBRA premium as scheduled and will receive a refund or premium credit.

Medical Mutual does not administer State Continuation.

Contact your Cornerstone representative with any questions.

https://www.crnstone.com/wp-content/uploads/2021/04/MMO-Update-on-COBRA-Subsidy-Period.jpg 480 640 Cornerstone /wp-content/uploads/2019/11/Cornerstone_Logo.png Cornerstone2021-04-16 13:08:572021-04-16 13:08:57Medical Mutual Update: Six-Month COBRA Subsidy Period Effective April 1, 2021

The BusinessPlans ARPA COBRA Response Plan

April 9, 2021/in Employee Benefits, Legislation /by Cornerstone

If your office represents a MEWA participating employer, here is the ARPA COBRA Response Plan, provided by BusinessPlans. This plan applies to both COBRA and State Continuation groups administered by BusinessPlans (myCobraPlan) on behalf of the MEWA.  Please pass this update along to your clients as needed:

Outbreak Extended Deadlines

Your client’s members have extra time to enroll and pay for COBRA.  Typically, this is an extra year of time, but that could be shorted depending on when the end date to the National Emergency is declared.  At this time, there is no estimated date for when the National Emergency will end.

Scenario New Deadlines During

National Emergency

New Deadlines After National Emergency End Date is Declared
Elections Extra year from original deadline 120 day after end of National Emergency
Initial Payments Extra year from original deadline 105 (60 + 45) days after end of National Emergency
Ongoing Payments Extra year from original deadline 90 (60 + 30) days after end of National Emergency

 ARPA Premium Assistance

Some of your client’s members may not owe premiums for April 2021 through September 2021. Eligibility determination, notification of eligible members and Employer tax credit processes are pending additional guidance from the DOL. This guidance is due on or before 05/01/2021.

  • Eligibility cannot be determined until May.
  • Once eligible members are identified, employers will pay for the coverage and related administration fees on the members behalf.
  • Employer will claim up to 102% of the premium cost as a tax credit.
  • Your client’s eligible members will have to pay April and May premiums and we will refund their payment once they are confirmed as an Assistance Eligible Individual (AEI).

Determining ARPA Premium Assistance Eligibility

Members who experienced a reduction in hours or were involuntarily terminated AND are not eligible for Medicare or other group health plan coverage are likely eligible. That determination is still pending the DOL’s guidance. Meanwhile, BusinessPlans will need additional information on many of your client’s member records to properly determine this eligibility. They are working on some database enhancements to make this process a little easier for your team. They will have more details on this lookback process to share in the next few weeks.

  Notices

  • Outbreak Notice (mailing this week). This communicates to your client’s members that they have extra time to elect and pay for COBRA. This mails to records sent to our database from late 2019 forward.
  • ARPA Premium Assistance Notice (mailing in May). This communication goes to members identified as eligible for the ARPA premium assistance.
  • ARPA Premium Assistance End Notice (mailing in Aug). This communication goes to members participating in the ARPA premium assistance.  It reminds them that the premium assistance will end as of 9/30/21.

Anticipated Timeline

By the Week Of: What Action is Required by:
DOL myCobraPlan Employers Members
4/26/21 Issue additional ARPA guidance X
4/26/21 Pay April premiums X
5/14/21 Identify involuntary terminations & reduction in hours events in lookback X
5/17/21 Data feeds adjusted to identify involuntary terminations & reduction in hours X
5/17/21 ARPA eligibility determined & member notices mailed X
5/24/21 Refund April (and May if paid) premiums to ARPA eligible members X
5/24/21 Delayed April non-payment notices to carriers and members initiated X
5/31/21 Delayed May remittance to Employers initiated X
6/7/21 Initiate tax credit process to offset premium expenses X

 Impacts

  • Members continue to pay April and May premiums.
  • ARPA eligible members will be refunded April and May payments by the BusinessPlans office in May.
  • Employers will pay the subsidized premiums on behalf of your members and then claim those expenses as tax credits.
  • To accommodate ARPA, monthly remittance of funds will be intentionally delayed for May and June. This ensures their reporting accurately reflects eligible amounts Employers should claim as a tax credit.
  • To accommodate ARPA, non-payment processing will be intentionally delayed for April and sent in late May.  This ensures they can determine ARPA eligibility before coverage drops are initiated.
  • Letters to members:
    • This Week – Outbreak Extension Notice – almost everyone since late 2019.   Sample letter can be found here.  EE_OutbreakNotice.pdf
    • In May – ARPA Subsidy Eligibility Notice – any ARPA subsidy eligible members
    • In August – ARPA Subsidy End Notice – any participating ARPA subsidy members
  • Additional Enrollments – Be prepared for new enrollments. Keep in mind these may involve retroactive reinstatements that date back years.  You may see some old names show up on your invoices again.  Please do not terminate their COBRA coverage inadvertently.
  • Online Entry – if you add any records through our online Employer portal, please start identifying voluntary and involuntary terminations and any reduction in hours event types.
    • Involuntary Termination – select “Termination – Involuntary” for event.
    • Voluntary Termination – select “Termination” for event.
    • Reduction in Hours – select “Reduction in Hours – Status change” for event.
  • Support for members – in anticipation of a large influx of member support needs, BusinessPlans has engaged their Navia COBRA support team to provide overflow support for your client’s members.

Contact your Cornerstone representative with any questions.

https://www.crnstone.com/wp-content/uploads/2021/04/BusinessPlans-ARPA-COBRA-Response-Plan.jpg 480 640 Cornerstone /wp-content/uploads/2019/11/Cornerstone_Logo.png Cornerstone2021-04-09 14:26:392021-04-09 14:26:39The BusinessPlans ARPA COBRA Response Plan

HHS Announces Reduced Costs and Expanded Access for Marketplace Coverage Under the American Rescue Plan

April 5, 2021/in Carrier, Individual, Legislation, Marketplace /by Cornerstone

The following post was originally published by Healthcare.gov.

U.S. Department of Health and Human Services (HHS) Secretary Xavier Becerra recently announced that additional savings and lower health care costs are available for consumers on HealthCare.gov. The American Rescue Plan (ARP) has increased tax credits available to consumers, helping to reduce premiums and giving consumers access to affordable health care coverage.

The Department also announced an additional $50 million in advertising to bolster the Special Enrollment Period outreach campaign. The campaign will run through August 15, 2021.

“We’re delivering lower health care costs to more Americans because everyone deserves access to quality, affordable health care. Today help is here and millions of Americans can start saving money on their health insurance premiums thanks to the American Rescue Plan,” said HHS Secretary Xavier Becerra. “The Biden Administration is committed to bringing down health care costs for families. Consumers can save money by visiting HealthCare.gov and choosing a plan that works for them and their budget. HHS will be reaching out to encourage Americans to use the Special Enrollment Period to sign up for quality, affordable coverage through HealthCare.gov.”

Premium tax credit calculations for the Marketplaces on HealthCare.gov are now adjusted so that most consumers qualify for more substantial advance payments of premium tax credits. Many Americans on the Marketplaces will see their premiums decrease, on average, by $50 per person per month and $85 per policy per month. An average of four out of five consumers currently enrolled in a plan through HealthCare.gov will be able to find a plan for $10 or less per month with the newly expanded financial assistance under the American Rescue Plan. Additionally, after advance payments of the premium tax credits, an average of three out of five uninsured adults eligible for coverage on HealthCare.gov may be able to access a zero-premium plan and nearly three out of four may find a plan for $50 or less per month on HealthCare.gov.

Current enrollees should review their application, make any changes needed to their current information, submit their application and select a plan, or reselect their current plan, to receive the increased advance payments of premium tax credits for 2021 Marketplace coverage. Consumers who take action in April and confirm updated savings on the plan of their choice will start receiving the savings and lower costs starting with their May 1 premiums.

Consumers who want to enroll in coverage and see if they qualify for more affordable premiums can visit HealthCare.gov or CuidadoDeSalud.gov to view 2021 plans and prices and, if eligible, enroll in a plan that best meets their needs. Additionally, consumers can call the Marketplace Call Center at 1-800-318-2596, which provides assistance in over 150 languages. TTY users should call 1-855-889-4325. Consumers can also find a local assister or agent/broker in their area: Get help applying and more | HealthCare.gov. Eligible consumers can apply through HealthCare.gov through August 15, 2021, to gain access to the Special Enrollment Period to change or update their plan choices.

Click here to review the full press release.

https://www.crnstone.com/wp-content/uploads/2021/04/HHS-Announces-Reduced-Costs-and-Expanded-Access-for-Marketplace-Coverage.jpg 480 640 Cornerstone /wp-content/uploads/2019/11/Cornerstone_Logo.png Cornerstone2021-04-05 13:50:522021-04-05 13:50:52HHS Announces Reduced Costs and Expanded Access for Marketplace Coverage Under the American Rescue Plan

Deadline Suspensions and COBRA Subsidies Due to COVID-19

April 5, 2021/in Legislation /by Cornerstone

Deadline Suspensions

Last year the Department of Labor (DOL) and Internal Revenue Service (IRS) announced that during the COVID “Outbreak Period” (the National Emergency period plus 60 days), the following deadlines will be suspended:

The date by which a member would need to:

  • File benefit claims
  • File appeals and requests for external review
  • Request enrollment following a HIPAA Special Enrollment event (birth, adoption, placement for adoption of a child, marriage, loss of other health coverage or eligibility for a state premium assistance subsidy)
  • Elect COBRA coverage
  • Pay COBRA premiums
  • Notify the plan of certain COBRA Qualifying life Events (e.g., divorce or legal separation, a dependent child ceasing to be a dependent under the terms of the plan) or a disability determination

At the time, the DOL and IRS probably did not envision the Outbreak Period lasting as long as it has. Unfortunately, there is a complicating factor that has only recently come into play. ERISA does not allow these types of deadline suspensions to continue for more than 12 months. Since the suspension first took effect March 1, 2020, this 12-month limitation is now relevant. There was some uncertainty how the 12-month limitation would be applied, so the DOL and IRS recently announced that it should be applied on a member-by-member basis. This means that for any given member, for any given deadline, the suspension will continue for no longer than 12 months or until the end of the Outbreak Period, whichever period is shorter.

As a result, some individuals started reaching their one-year maximum suspension period on March 1, 2021. Once their maximum suspension period is reached, individuals must take action to avoid missing their deadlines.

Your clients may want to consider responding to this development by taking certain actions, including alerting their membership to the changes, updating employee facing communications, and updating plan documents.

COBRA Subsidy and new COBRA Election Period

The American Rescue Plan Act (ARPA) was signed into law on March 11, 2021. Under ARPA, individuals and their dependents who are eligible for COBRA or state COBRA (sometimes referred to as state continuation benefits or mini-COBRA), due to involuntary termination or reduction of work hours may be eligible for a 100% COBRA premium subsidy, beginning April 1, 2021 through to September 30, 2021. They may also be eligible for a new COBRA Election period. The DOL will issue a Model Notice mid-April, explaining the subsidy and election period in detail. The Plan Administrator must distribute this notice to impacted individuals.

This information was originally published by Aetna.

https://www.crnstone.com/wp-content/uploads/2021/04/Deadline-Suspensions-and-COBRA-Subsidies.jpg 480 640 Cornerstone /wp-content/uploads/2019/11/Cornerstone_Logo.png Cornerstone2021-04-05 13:23:102021-04-05 14:06:22Deadline Suspensions and COBRA Subsidies Due to COVID-19

IRS Identifies PPE as Qualified Medical Expense Under Section 213(d)

April 5, 2021/in Cornerstone Updates, Legislation /by Cornerstone

According to Announcement 2021-7 from the Internal Revenue Service (IRS), personal protective equipment (PPE), such as masks, hand sanitizer, and sanitizing wipes, are considered qualified medical expenses under Section 213(d) of the Internal Revenue Code. The primary purpose of the PPE must be to prevent the spread of COVID-19.

These expenses are eligible for reimbursement from flexible spending arrangements (FSA), health reimbursement accounts (HRA), and health savings accounts (HSA).

Navia/Flexbank has provided a convenient list of all eligible and ineligible qualified medical expenses for account-based plans. Click here to review.

Contact your Cornerstone representative for more information.

https://www.crnstone.com/wp-content/uploads/2021/04/IRS-Identifies-PPE-as-Qualified-Medical-Expense.jpg 480 640 Cornerstone /wp-content/uploads/2019/11/Cornerstone_Logo.png Cornerstone2021-04-05 13:09:342021-04-05 13:09:34IRS Identifies PPE as Qualified Medical Expense Under Section 213(d)

2020 HSA Contribution Deadline Extended to May 17

April 1, 2021/in Compliance, Employee Benefits, Legislation /by Cornerstone

According to a release from Navia Benefit Solutions and FlexBank, the IRS has just confirmed 2020 HSA Contributions may be accepted up to the filing deadline of May 17, 2021. These are HSA contributions made with after tax dollars (not pre-tax contributions made through payroll deduction). You’ll want to remember to deduct this contribution on your personal tax return.

Please note: This only applies to individuals who owned/contributed to an HSA in 2020. If your high deductible health plan/HSA started in 2021, you can ignore this memo.

Contact your Cornerstone representative with any questions.

https://www.crnstone.com/wp-content/uploads/2021/04/HSA-Contribution-Extension-2021.jpg 480 640 Cornerstone /wp-content/uploads/2019/11/Cornerstone_Logo.png Cornerstone2021-04-01 20:39:382021-04-01 20:39:382020 HSA Contribution Deadline Extended to May 17

IMPORTANT UPDATE: CMS Extends SEP to August 2021

March 25, 2021/in Cornerstone Updates, Individual, Legislation, Marketplace /by Cornerstone

In response to the benefits outlined in the American Rescue Plan regarding increased tax credits to reduce premiums, the Centers for Medicare and Medicaid Services (CMS) has extended access to the 2021 SEP to August 15, 2021. This will allow individuals and families more time to access the SEP and enroll in Marketplace coverage, and for current enrollees to change plans in response to the availability of increased tax credits if they wish to do so.

Click here to review the full release from CMS.

In case you missed it…

Cornerstone’s Geoff Beglen recently held an Individual Corner webinar reviewing the American Rescue Plan, the new rules, subsidy eligibility requirements, and how to maximize this opportunity. Check it out below!

Contact your Cornerstone individual team with any questions.

https://www.crnstone.com/wp-content/uploads/2021/03/CMS-Extends-SEP.jpg 480 640 Cornerstone /wp-content/uploads/2019/11/Cornerstone_Logo.png Cornerstone2021-03-25 13:57:002021-03-25 13:57:00IMPORTANT UPDATE: CMS Extends SEP to August 2021

How the American Rescue Plan Impacts ACA Enrollments

March 12, 2021/in Individual, Legislation, Marketplace /by Cornerstone

President Biden recently signed the American Rescue Plan Act (ARPA) into law, which contains a number of provisions on exchange subsidies, dependent care flexible spending accounts, unemployment and economic stimulus, and PPP loans/aid to businesses.

For those enrolled in ACA plans, the law includes provisions that significantly affect subsidies and Advance Premium Tax Credits (APTC), including…

Note: Subsidies are retroactive to January 1, 2021.

Larger subsidies for 100 to 400 percent FPL

Enrollees within 100 to 150 percent FPL are eligible for a $0 premium silver plan with substantial cost sharing reductions that lower deductibles.

Expanded APTC eligibility to those above 400 percent FPL

The new bill caps the percentage of income paid for a Marketplace benchmark silver premium to 8.5 percent, which makes ACA coverage significantly more affordable for enrollees who traditionally had too high of an income to qualify.

APTC guarantees for enrollees receiving unemployment compensation

If an enrollee is receiving unemployment compensation, they will qualify for subsidies as if their income is 133 percent FPL. This means these enrollees are eligible for a silver plan with a $0 premium and significant cost sharing reductions.

Click here to view a fact sheet provided by HealthSherpa.

https://www.crnstone.com/wp-content/uploads/2021/03/How-the-American-Rescue-Plan-Impacts-ACA-Enrollments-1.jpg 480 640 Cornerstone /wp-content/uploads/2019/11/Cornerstone_Logo.png Cornerstone2021-03-12 17:50:512021-03-12 17:53:59How the American Rescue Plan Impacts ACA Enrollments

ATTENTION: What Your Clients Need to Know About the American Rescue Plan Act

March 11, 2021/in Employee Benefits, Individual, Legislation, Marketplace /by Jennifer Agnello

Attention: If your clients are subject to COBRA law, please read this important alert.

Yesterday, President Biden signed into law the American Rescue Plan Act (ARPA). This bill contains provisions on exchange subsidies, dependent care flexible spending accounts, unemployment and economic stimulus, and  PPP loans/aid to businesses. Also, this bill requires additional administration from employers with respect to COBRA.

Under this bill, eligible COBRA enrollees (and their families) can receive a 100 percent federal subsidy for their COBRA premiums. This federal government subsidy will be granted through payroll tax credits for employers. The employer will pay 100 percent of the former employee’s COBRA premium during the time period and will be reimbursed by the federal government through a credit against payroll taxes or, for credit amounts exceeding payroll taxes, as a refund of an overpayment.

The subsidy for COBRA premiums will begin on April 1, 2021, and end on September 30, 2021. Eligibility for the subsidy requires involuntary termination of employment or a reduction in hours only. Employees who terminate voluntarily from employment are not eligible.

The subsidy will last for a maximum of six months. Subsidies will end the earlier of 1) the individual’s maximum period of COBRA coverage (normally 18 months) or 2) September 1, 2021. If the individual receiving the subsidy becomes eligible for coverage under another employer’s group health plan or under Medicare, the subsidy will also end early.

Individuals on COBRA are required to notify their former employers if they become eligible for such coverage, however under ARPA, individuals will be subject to a $250 penalty if they fail to notify their former employer of their new opportunity for coverage. If the failure is deemed to be with intent, the penalty is the greater of $250 or 110 percent of the subsidy.

Employers are permitted (not required) to allow employees to choose a different group health plan than their current selection but the premium cannot be higher than the employee’s former plan. If the employer chooses to allow this change, the employee would have 90 days from the date of their COBRA notice to make a new plan selection.

Employers have responsibilities. They must provide a revised COBRA notice to all who may be eligible for the subsidy. This requires employers to amend their current COBRA notices and election forms. We expect new model notices to be issued within approximately 30 days. Employers must also provide notices to eligible workers who have yet to elect COBRA by April 1, 2021, and those who elected COBRA but then discontinued it. Those previous employees may elect COBRA during the deemed enrollment period of April 1 ending 60 days from the date notice of the subsidy was provided.

Employers should discuss these changes and responsibilities with their agent and/or their COBRA administrator or third-party administrator immediately in order to prepare. A list of potentially eligible employees should be compiled so that notices can be sent as they are developed. The list should include all COBRA eligible former employees who were eligible for the last 18 months, those who have termed from the plan back to November of 2019 since their 18 months of coverage would have run through April of 2021.

We ask that you reach out to your Cornerstone representative for more detailed information as the administration continues to develop. We will stay ahead of all the latest news and information to ensure you are in the loop.

https://www.crnstone.com/wp-content/uploads/2021/03/Impact-of-COVID-Relief-on-COBRA-and-ACA.jpg 480 640 Jennifer Agnello /wp-content/uploads/2019/11/Cornerstone_Logo.png Jennifer Agnello2021-03-11 20:12:302021-03-12 14:52:59ATTENTION: What Your Clients Need to Know About the American Rescue Plan Act

President Biden Extends ACA Open Enrollment with New Executive Order

January 28, 2021/in Cornerstone Updates, Legislation, Marketplace /by Cornerstone

With a new executive order, President Biden has opened a special enrollment period for the Affordable Care Act from February 15 to May 15, 2021, giving those without employer-sponsored coverage an opportunity to sign up for health insurance coverage.

Contact your Cornerstone representative with any questions.

https://www.crnstone.com/wp-content/uploads/2021/01/ACA-OEP-Extension-February-2021.jpg 480 640 Cornerstone /wp-content/uploads/2019/11/Cornerstone_Logo.png Cornerstone2021-01-28 15:17:012021-02-26 18:51:25President Biden Extends ACA Open Enrollment with New Executive Order
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