On March 11, 2021, the American Rescue Plan Act of 2021 (ARPA) was signed. ARPA includes a provision for a COBRA continuation coverage premium subsidy of 100% for individuals and families who experienced an involuntary termination of employment or reduction in hours.

This subsidy will be available for Assistance Eligible Individuals (AEIs), as determined by the Act, from April 1, 2021 through Sept. 30, 2021, or the end of the qualified beneficiary’s maximum period of eligibility, whichever is earlier. COBRA participants must meet the below criteria in order to be an AEI:

• Coverage was lost due to involuntary termination of employment or reduction in hours

• The qualified beneficiary is still within the COBRA eligibility period as of April 1, 2021

• The qualified beneficiary is not eligible for coverage under another group health plan or Medicare

• Assistance Eligible Individuals who do not have an election in place will have another 60-day opportunity to make an election and will be able to take advantage of the subsidy effective April 1, 2021. COBRA coverage for individuals who elect coverage during this extended election period will begin on April 1, 2021

• Eligible COBRA participants who have an election in place as of April 1, 2021 will be able to take advantage of the subsidy effective April 1, 2021

• Qualified beneficiaries who become eligible for COBRA continuation coverage due to an involuntary termination of employment or reduction in hours on or after April 1, 2021, and are not eligible for coverage under another group health plan or Medicare, will be eligible for the subsidy while it is in effect

• Qualified beneficiaries who experienced a qualifying event of an involuntary termination of employment or reduction in hours and are still in their original 18-month COBRA eligibility period as of April 1 must be notified of the opportunity to receive the subsidy and the extended election period