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
|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.
- 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.
|By the Week Of:||What||Action is Required by:|
|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|
- 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.