Updated Model COBRA Election Notice Includes Information Regarding Health Insurance Exchanges (Marketplaces)
A revised Model COBRA Election Notice is now available for group health plans to inform eligible employees and dependents of the right to continuation of coverage under federal law and how to make an election when a qualifying event occurs. The updated model notice includes additional information for qualified beneficiaries who may want to consider and compare health coverage alternatives to COBRA that will be available through the Exchanges (also known as Marketplaces), which are expected to begin operating in 2014. The revised notice also describes the availability of premium tax credits for purchasing coverage through the Exchange.
Federal COBRA generally applies to group health plans sponsored by employers with 20 or employees (including both full- and part-time employees) on more than 50% of their typical business days in the previous calendar year. In general, an individual who was covered by a group health plan on the day before a qualifying event (such as termination of employment) may be able to elect COBRA continuation coverage upon a loss of coverage due to the qualifying event. Upon the occurrence of a qualifying event, the plan administrator is required to provide these individuals (called “qualified beneficiaries”) with an election notice, generally within 14 days after the administrator receives notice of the qualifying event