2021 Membership Directory Final

SPECIAL COVID-19 SECTION

NEW COBRA SUBSIDIES – TAX CREDIT AVAILABLE FOR EMPLOYERS

The American Rescue Plan Act (ARPA), which is the latest bill to address the ongoing economic impact of COVID-19 became effective in March 2021.

HOT TOPICS 2021 MEMBERSHIP DIRECTORY & SERVICES GUIDE ARPA creates a 6-month subsidy period (April 1 to September 30, 2021) during which certain “assistance eligible individuals” (AEI) may qualify for a 100% subsidy for COBRA coverage. AEIs are defined as, “individuals who are eligible for COBRA coverage during the subsidy period due to a reduction in hours or involuntary termination of employment qualifying event and enroll (or have already enrolled) in COBRA coverage”.

ARPA also creates an extended COBRA election period for AEI, so that an AEI who previously declined COBRA coverage, or whose coverage was terminated because of nonpayment of premiums, may now enroll and receive the subsidized coverage for the length of the subsidy period. A qualifying AEI would pay no cost for monthly COBRA premiums for medical, dental, or vision coverage if the individual is eligible for COBRA coverage during the subsidy period. The subsidy period does not extend the maximum COBRA coverage period. ARPA simply suspends the AEI’s obligation to make COBRA premium payments for up to 6 months. These rules are not optional for employer sponsored group health plans. The employer (or plan, in the case of amulti-employer plan; or insurer for non-ERISA fully insuredplans) has anobligation to provide this group health plan coverage. Dealers would advance the premium cost and recover the costs of those premiums from the federal government by claiming a credit against its quarterly Medicare payroll tax liability. The credit can be advanced and is refundable, meaning the employer can claima refund if the subsidy exceeds the taxes due. NY HERO Act Requires a Plan to Prevent Airborne Infectious Diseases In May, NY became the first state to impose legal obligations on employers to address on-going threats relating to the spread of COVID-19 and future airborne infectious diseases. New York Labor Law has been amended to impose two significant changes on all private sector employers.

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