The updates clarify to workers that if they are eligible for COBRA continuation coverage when leaving a job, they may choose to instead purchase coverage through the federal Health Insurance Marketplace.
“In many cases, workers eligible for COBRA continuation coverage can save significant sums of money by instead purchasing health insurance through the marketplace,” says Assistant Secretary of Labor for Employee Benefits Security Phyllis C. Borzi, based in Washington, D.C. “COBRA continues to play an important role in helping workers and families maintain coverage after a job loss, and it is important that workers know that in some cases there is a marketplace option as well.”
Workers and their families who are eligible for employer-sponsored coverage generally must be informed of their right to COBRA continuation coverage at the start of employment. They must also be informed of their right to purchase COBRA coverage when separating from a job.
The proposed changes to the model notices offer information about more affordable options available through the marketplace, where workers and families may be eligible for financial assistance that would not otherwise be available for COBRA continuation coverage. In most cases, workers and their families eligible for, but not enrolled in, COBRA continuation coverage would be able to enroll in marketplace coverage outside of the normal open enrollment period.
Frequently asked questions related to the proposed changes to model notices have been posted to the DOL’s website and the Department of Health and Human Services’ (HHS) website. In addition, the HHS is publishing a clarifying bulletin regarding a special enrollment period in the marketplace for individuals already enrolled in COBRA continuation coverage.
The updated model notices are posted on the DOL website here and here. A related notice of proposed rulemaking on the COBRA notice requirements will be published in the May 7 edition of the Federal Register. The notice of proposed rulemaking can also be viewed here.