COBRA Notice Model Update

On May 2, 2014, the Department of Labor (“DOL”) released updated COBRA notice models. The most prominent change contained in the updated models is the addition of content explaining the availability of health coverage through the health insurance marketplace. In particular, the updated models now clarify that the use of COBRA coverage does not make one ineligible for purchasing insurance through the marketplace. Furthermore, the updated models explain the possibility of employees finding cheaper coverage through the marketplace, as opposed to using COBRA coverage, potentially aiding employers by guiding employees to the marketplace and away from COBRA coverage.

While employers are not required to follow these updated models, the models provide employers with a template for creating their notices. Employer drafting notices based on the models are presumed to meet all notice requirements. Due to this, employers are advised to utilize the models in creating their COBRA notices.

In response to the updated COBRA notice models, employers should begin altering their existing COBRA notices to reflect the changes informing employees about the availability of marketplace coverage. Employers wishing to do so can find the updated COBRA notice models here.

About Jim Hamilton

I am an employee benefits partner with Bose McKinney & Evans LLP. My broad-based practice covers health and welfare arrangements, insurance, executive compensation and federal and state taxation. Among other areas, I have specific experience with PPACA, HIPAA, COBRA, ERISA and numerous other state and federal laws affecting employee benefit plans.
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