The Department of Labor (“DOL”) has issued updated versions of its model general notice and model election notice to ensure that qualified beneficiaries better understand the interactions between Medicare and COBRA.
Background. Under COBRA, an individual who was covered by a group health plan on the day before the occurrence of a qualifying event (such as a termination of employment or a reduction in hours that causes loss of coverage under the plan) may be able to elect COBRA continuation coverage. Individuals with such a right are referred to as qualified beneficiaries.
Under COBRA, group health plans must provide covered employees and their families with certain notices explaining their COBRA rights. A group health plan administrator must provide each covered employee and spouse with a “general” notice of COBRA rights at the time of commencement of coverage under the plan. The plan must also provide qualified beneficiaries with an election notice describing their right to elect COBRA continuation coverage when a qualifying event occurs.
Revised COBRA Notices. As DOL notes, “[S]ome qualified beneficiaries may want to consider and compare health coverage alternatives to COBRA continuation coverage, such as coverage that is available through the Health Insurance Marketplace. Qualified beneficiaries may be eligible for a premium tax credit (a tax credit to help pay for some or all of the cost of coverage in plans offered through the Marketplace) and cost-sharing reductions (amounts that lower out-of-pocket costs for deductibles, coinsurance, and copayments), and may find that Marketplace coverage is more affordable than COBRA. Qualified beneficiaries may also be eligible for Medicare, or have questions about the interaction between Medicare and COBRA.” Revised model notices, which may be used at the initial time of notice and when a qualifying event has occurred, provide additional information on the relationship and interactions between COBRA coverage and Medicare.
Plan administrators may use the DOL model notices to satisfy both COBRA notice requirements.
NOTE: These revised COBRA notices do not include information about the extension of certain COB RA deadlines due to the impact of COVID-19. See our Alert of May 5, 2020 for more information on the deadline extensions.
The revised notices and related Q&As can be found at: https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/cobra