COBRA Articles

COBRA Audits Updated

webmaster@elinfonet.com (Employment Law Information Network) — Thu, 17 May 2012 00:00:00 EST

Executive Summary: The IRS recently issued revised guidelines for field agents who are conducting reviews of employers' COBRA compliance.

Once Bitten, Twice Shy: COBRA Excise Tax Audits May Add to COBRA's Bite

webmaster@elinfonet.com (Employment Law Information Network) — Fri, 13 Apr 2012 00:00:00 EST

The advent of Health Care Reform has not lessened the importance of complying with existing Employee Retirement Income Security Act (ERISA) and Internal Revenue Code requirements for employer-provided group health plans, such as COBRA, which requires covered health plans to provide certain notices and the opportunity to elect continued coverage to covered persons (qualified beneficiaries) who would otherwise lose coverage because of certain "qualifying events" such as termination of employment, loss of dependent status, and others.

IRS Issues New COBRA Audit Guidelines

webmaster@elinfonet.com (Employment Law Information Network) — Thu, 12 Apr 2012 00:00:00 EST

Recently, the Internal Revenue Service (IRS) published Revised Audit Guidelines for use by IRS auditors in examining group health plans for COBRA compliance. The revised Guidelines incorporate changes to account for laws that have affected COBRA since the previous guidelines were developed, such as the Health Insurance Portability and Accountability Act (HIPAA) and the Family and Medical Leave Act (FMLA). The Guidelines appear to herald a new COBRA compliance audit effort by the IRS.

Stimulus Package Creates Subsidy for Health Care Continuation Coverage

webmaster@elinfonet.com (Employment Law Information Network) — Mon, 09 Mar 2009 00:00:00 EST

On Feb. 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009 (the �ARRA�). The ARRA seeks to stimulate the economy by authorizing approximately $787 billion in tax cuts and spending for a variety of programs, including health, education and job creation. Of immediate significance to employers, health plans and insurers are provisions that expand the rights of terminated employees under the Consolidated Omnibus Budget and Reconciliation Act of 1985, as amended (�COBRA�). This Alert summarizes the ARRA�s changes to COBRA, describes employers� obligations under this new legislation and provides guidance on various notice requirements.

Department of Labor Issues Model Notices for Subsidized COBRA Premiums

webmaster@elinfonet.com (Employment Law Information Network) — Thu, 20 Mar 2008 00:00:00 EST

President Obama on Feb. 17, 2009, signed into law the American Recovery and Reinvestment Act of 2009 (the �ARRA�). The ARRA expands the rights of terminated employees and their eligible beneficiaries under the Consolidated Omnibus Budget and Reconciliation Act of 1985, as amended (�COBRA�). Specifically, the COBRA provisions of the ARRA provide that 65 percent of an assistance eligible individual�s COBRA premiums will be subsidized by the U.S. government. While the employer or other plan sponsor is initially required to front the cost of the subsidy, the government will reimburse the entity by providing it with a credit against its payroll taxes and/or a refund.

IRS Issues Additional Guidance on COBRA Premium Subsidy

webmaster@elinfonet.com (Employment Law Information Network) — Fri, 10 Apr 2009 00:00:00 EST

The American Recovery and Reinvestment Act of 2009 (the �ARRA�) expands the rights of assistance eligible individuals under the Consolidated Omnibus Budget and Reconciliation Act of 1985, as amended (�COBRA�), by subsidizing 65 percent of their COBRA premiums. On March 31, 2009, the Internal Revenue Service issued Notice 2009-27 (the �Notice�). The Notice, which consists of 58 �Q&As,� provides information on a wide-range of topics related to the ARRA, including what constitutes an �involuntary termination,� who qualifies as an �assistance eligible individual,� how to calculate the premium reduction, what type of coverage is eligible for the premium reduction, and what is considered the beginning and end of the premium reduction period. The Notice also provides additional information on the recapture of the COBRA premium subsidy, the extended election period, payments to insurers, and the application of the subsidy rules to comparable state continuation coverage programs. This Alert sets forth some of the guidance covered in the Notice.

Practical Insights: Dealing with Medicare Part B and COBRA Coverage.

webmaster@elinfonet.com (Employment Law Information Network) — Wed, 11 Aug 2010 00:00:00 EST

Generally, the Socal Security Act provides that individuals may enroll in Medicare Part B (which covers doctors visits and other outpatient services) when they reach age 65. If they fail to do so during a seven-month initial enrollment period surrounding their 65th birthday, they can enroll during an annual "general enrollment" period that occurs each January 1- March 31, with coverage becoming effective the following July1, though they will incur a penalty in the form of permanently higher Part B premiums (10% increase for each year of available coverage that is foregone). However, actively employed individuals who have employer-provided health coverage can postpone signing up for Medicare Part B until after age 65. When they lose the employer-provided coverage or terminate employment, whichever happens first, they are then provided an eight-month "special enrollment period" ("SEP") during which they can sign up for Medicare effective immediately and without penalty.

DOL Issues Model Notices for COBRA Subsidy Extension

webmaster@elinfonet.com (Employment Law Information Network) — Tue, 10 Aug 2010 00:00:00 EST

The Department of Labor (the �DOL�) has issued three model notices for communicating the recent extension of the Federal COBRA subsidy.

COBRA Subsidy Unlikely to be Extended Further.

webmaster@elinfonet.com (Employment Law Information Network) — Mon, 21 Jun 2010 00:00:00 EST

The American Recovery and Reinvestment Act provided a 65% COBRA premium subsidy to eligible individuals involuntarily terminated between September 1, 2008, and December 31, 2009. Congress later extended the subsidy three times; most recently for those involuntarily terminated on or before May 31, 2010. (For information regarding the original COBRA subsidy and the previous extensions, please see our archived E*Bulletins from April 2010, March 2010, January 2010, March 2009, and February 2009.)

President Signs Another COBRA Subsidy Extension.

webmaster@elinfonet.com (Employment Law Information Network) — Tue, 04 May 2010 00:00:00 EST

President Obama has signed legislation extending the COBRA premium subsidy to assist individuals who have lost their jobs since the previous COBRA subsidy expired March 31, 2010.