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COBRA Toolkit
Practical Law Toolkit w-001-8389 (Approx. 13 pages)
COBRA Toolkit
by Practical Law Employee Benefits & Executive Compensation
| Maintained • USA (National/Federal) |
A collection of resources to help employers and their advisors understand and comply with the group health plan continuation coverage requirements under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA).
Under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), most employer-sponsored group health plans must offer covered employees and their families the opportunity to continue their health coverage in situations where the coverage would otherwise end due to certain life events (known as qualifying events). COBRA imposed these requirements through amendments to the Employee Retirement Income Security Act of 1974 (ERISA), the Internal Revenue Code (Code), and the Public Health Service Act (PHSA) (see Article, ERISA at 50: The Rise of Health Plan Compliance and Litigation: COBRA, HIPAA, Mental Health Parity, and More (1985 to 1999)). Individuals who lose plan coverage due to a COBRA qualifying event (known as qualified beneficiaries) may include employees, spouses, and dependent children.
COBRA compliance has been the topic of statutory and regulatory developments over the years, including:
- Final regulations issued by the Department of Labor (DOL) in May 2004 addressing COBRA's notice requirements (69 Fed. Reg. 30084 (May 26, 2004)).
- COBRA premium subsidies for employees who experienced involuntary terminations between September 2008 and May 2010, under the American Recovery and Reinvestment Act of 2009 (ARRA).
In 2020, the DOL extended the deadlines for certain COBRA-related compliance obligations in response to the COVID-19 pandemic (see Practice Note, COVID-19 Compliance for Health and Welfare Plans and Article, COVID-19 Public Health Emergency (PHE) and National Emergency (NE) Wind-Down: Health and Welfare Plan Compliance Issues).
Keeping Up with COBRA Compliance
This COBRA Toolkit provides a collection of continuously updated resources that address various aspects of COBRA compliance, including:
- Substantive requirements under COBRA, its implementing guidance, and relevant caselaw (for example, COBRA's notice obligations for plan administrators).
- Common contexts in which COBRA-related issues may arise (for example, severance situations and mergers and acquisitions).
In addition, COBRA has been the topic of extensive litigation that highlights the need for vigilance in COBRA compliance (for example, see Legal Update, COBRA Election Notice Failure Underscores Need for Mailing Address Procedures (Sept. 2022)).
ARPA-21/COBRA Premium Assistance
COVID-19 economic stimulus legislation enacted in March 2021:
- Made available full premium subsidies for individuals who were involuntarily terminated or experienced a reduction in hours from April 1, 2021, through September 30, 2021.
- Included an extended election period for COBRA coverage.
- Allowed individuals to change enrollment to different coverage in certain circumstances.
(American Rescue Plan Act of 2021 (ARPA-21), Pub. L. No. 117-2, § 9501 (Mar. 11, 2021).)
In some respects, the ARPA-21 provisions resembled ARRA's COBRA premium assistance requirements (see ARRA/ARPA-21 COBRA Premium Assistance Comparison Chart). The ARPA-21/COBRA provisions were addressed in DOL implementing guidance and model notices—and in extensive IRS Q&A guidance (Notice 2021-31; Notice 2021-46).
The following resources address ARPA-21/COBRA premium assistance compliance: