The American Rescue Plan Act is a federal law that includes a temporary program to subsidize 100% of premium costs for individuals on COBRA between April 1 and September 30, 2021. While COBRA is overseen by the federal government, these subsidies also apply to mini-COBRA for 2-19 employees that is regulated by the Massachusetts Division of Insurance.
Who qualifies for the temporary subsidy program?
To qualify for assistance, an individual must first be eligible for COBRA because of an involuntary termination or a reduction in hours. He or she must not be eligible for coverage through another group health plan (for example through a spouse or new employer). The individual also must elect COBRA. An individual must not be enrolled or eligible for coverage through Medicare.
Who covers the cost of the temporary subsidy?
- Fully and self-insured employers with 20 or more employees are required to cover the cost of the subscriber premium, but may then seek reimbursement through a credit on their federal payroll tax filing.
- For fully-insured employers with 2-19 employees, AllWays Health Partners will pay the subscriber premium for mini-COBRA.