Affordable Care Act Update - Concerning Cobra Notices from Employers

Marc Altneu is a local insurance broker/consultant. Marc Can be reached at marc@mcmagency.com

On June 21, 2016, the Departments of Labor, Health

and Human Services, and the Treasury (collectively, the

“Departments”) issued the 32nd Affordable Care Act (“ACA”)

FAQ describing information that may be appropriate to include

with COBRA notices. Many wondered if it were appropriate

to provide information and if so, what kind of information

could be provided about the Health Insurance Marketplaces/

Exchanges (“Marketplaces”) so that COBRA-eligible

individuals could consider health coverage alternatives

available through the Marketplaces and possibly investigate

whether they may be eligible for premium tax credits

and cost-sharing reductions. The current model COBRA

notice includes some information to help make qualified

beneficiaries aware of other coverage options available in

the Marketplaces, but that information is limited. Note that

employers also should send a Notice of Coverage Options

to all employees at time of hire. That document describes

Marketplace options as well.

Under this new FAQ, the DOL indicated that it would be

appropriate for an employer to provide additional information

about the availability of Marketplace coverage provided that

any communication can be “easily understood by the average

participant.” In that vein, any additional information should

not be too lengthy or difficult to understand. Specifically, plan

administrators are encouraged to include with the COBRA

election notices additional information about the Marketplaces

such as: how to obtain assistance with enrollment (including

special enrollment), the availability of financial assistance,

information about Marketplace websites and contact

information, general information regarding particular products

offered in the Marketplaces, and other information that may

help qualified beneficiaries choose between COBRA and

other coverage options. In addition, communications may

include information that is specifically tailored to particular

groups such as young adults aging out of dependent

coverage on their parents’ health plan.

Employers should consider adding more detailed information

about the availability of Marketplace coverage to assist

COBRA qualified beneficiaries in making informed elections

and understanding available options. For those using COBRA

administration vendors, employers can request that additional

Marketplace information be included with notices being sent

to COBRA qualified beneficiaries.

For the FAQ, visit:

https://www.dol.gov/ebsa/pdf/f...