Newtek Insrance Agency

No Doubt You'll Have Questions

Provisions in the recently passed American Rescue Plan Act focus specifically on COBRA and former employees who have been terminated involuntarily during the pandemic. There is a lot to understand, and some of the finer details are still being hammered out, but we want to address a few things here. We also encourage you to contact your dedicated Account Manager who can explain things much more thoroughly.

These are just a few highlights:
  • What changes have been made to COBRA election deadlines due to COVID-19?
    • In April of 2020, the Department of Labor (DOL) and IRS issued a pause on COBRA election and premium payment deadlines during the "Outbreak Period" of the Coronavirus pandemic.
    • The "Outbreak Period" is defined as the "period beginning March 1, 2020 and ending 60 days after the end of the National Emergency is declared by the President."
    • Qualified beneficiaries can now delay their COBRA elections and payments until these deadlines expire.
    • Since the National Emergency is still ongoing, the determination of when the "Outbreak Period" ends will be calculated based on each individual's qualifying event.
  • What changes have been made to COBRA premium payment deadlines due to COVID-19?
    • For the premium extensions, simply add one year to the standard date that the premium would have been due.
    • Please note, the DOL states that if the plan administrator or other responsible plan fiduciary knows, or should reasonably know, that the end of the relief period for a qualified beneficiary is exposing a participant or beneficiary to a risk of losing benefits, the administrator or other fiduciary should consider sending a notice regarding the end of the relief period.
  • There are numerous provisions regarding COBRA Premium Subsidies, including
    • Eligibility
    • Responsibility
    • Applicability
  • Employers must adhere to new COBRA Compliance laws including releasing new model notices
    • General Election Notice
    • Special Election Notice
    • Notice of Subsidy Expiration
  • Assistance Eligible Individuals (AEI) must qualify for COBRA Premium Subsidy
    • If the AEI qualifies, they will receive a COBRA subsidy to cover 100% of the premium plus the 2% admin fee from 4/1/2021 through 9/30/2021.
We understand that this is a lot to take in. You might have several questions. Your dedicated Account Manager can take the time to thoroughly explain the provisions and answer your questions. Newtek offers services to take this burden off of your shoulders and comply with the new legislation. Please do not hesitate to reach out.

Newtek Insurance Agency
Contact:
Newtek Insurance Agency
Phone: 855-763-9835
Email: Info@NewtekOne.com