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American Rescue Plan Act and the COBRA Subsidy – Déjà Vu All Over Again | Jackson Walker


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In the American Rescue Plan Act (the “Relief Act”), a subsidy for the payment of COBRA premiums was added for the period beginning on April 1, 2021, through September 30, 2021. Unlike previous COBRA premium subsidies, this subsidy permits assistance eligible individuals to elect COBRA at no cost to the individual for the six-month period of premium assistance.
Full elimination of premiums applies to any individual who elects COBRA as the result of losing coverage due to termination of employment (other than for gross misconduct) or to a reduction in hours of work. Such a person is referred to as an “assistance eligible individual”. The assistance eligible person definition does not exclude persons who may already be on COBRA continuation coverage due to a termination of employment or reduction in hours which occurred prior to the enactment of the Relief Act. This COBRA premium assistance applies to group ....

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