The U.S. Department of Labor (DOL) and Department of Health and Human Services (HHS) recently updated and clarified a few aspects of the Consolidated Omnibus Reconciliation Act (COBRA). The changes are important for employers because they relate to the ongoing implementation of the Affordable Care Act (ACA) and require that employers scrap or modify their current COBRA forms.
The first update comes from the DOL in the form of a new COBRA model general notice form and COBRA model election notice. The documents have been modified to incorporate ACA-related language; notifying employees about the option of enrolling in the federal Health Insurance Marketplace, informing them that such an option may be cheaper and that they may qualify for federal subsidies.
The second update comes from HHS and clarifies special enrollment periods (SEPs) in relation to the federal Health Insurance Marketplace and encouraged state exchanges to adopt similar standards. HHS has made it clear that individuals eligible for COBRA will be eligible for enrollment in the Health Insurance Marketplace either when they become eligible for COBRA or after their COBRA coverage runs out.
Clearly, the goal of the Administration in making these updates and clarifications is to push COBRA-eligible individuals to the federal exchange by marketing it as a viable and potentially cheaper option. This may impact an employer’s COBRA administration in the future, but in the short-run, we wanted to be sure that you were aware of these updated documents and the new ACA verbiage.
Got an employee benefit question? Contact us and let us know how we can help. Our brokers and consultants are on the front lines of the ever-changing health insurance and employee benefit industry and are here to help guide you through the changes.
Image credit: Ted Major via flickr