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EBSA
Notices
Publication of Model Notices for Health Care Continuation Coverage Provided Pursuant to the Consolidated Omnibus Budget Reconciliation Act (COBRA) and Other Health Care Continuation Coverage, as Required by the American Recovery and Reinvestment Act of 2009, Notice
[ 3/20/2009]
[ PDF]
FR Doc E9-6131
[Federal Register: March 20, 2009 (Volume 74, Number 53)]
[Notices]
[Page 11971-11973]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20mr09-86]
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DEPARTMENT OF LABOR
Employee Benefits Security Administration
Publication of Model Notices for Health Care Continuation
Coverage Provided Pursuant to the Consolidated Omnibus Budget
Reconciliation Act (COBRA) and Other Health Care Continuation Coverage,
as Required by the American Recovery and Reinvestment Act of 2009,
Notice
AGENCY: Employee Benefits Security Administration, Department of Labor.
ACTION: Notice of the Availability of the Model Health Care
Continuation Coverage Notices Required by ARRA.
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SUMMARY: On February 17, 2009, President Obama signed the American
Recovery and Reinvestment Act (ARRA) of 2009 (Pub. L. 111-5). ARRA
includes a requirement that the Secretary of Labor (the Secretary), in
consultation with the Secretaries of the Treasury and Health and Human
Services, develop model notices. These models are for use by group
health plans and other entities that, pursuant to ARRA, must provide
notices of the availability of premium reductions and additional
election periods for health care continuation coverage. This document
announces the availability of the model health care continuation
coverage notices required by ARRA.
FOR FURTHER INFORMATION CONTACT: Kevin Horahan or Amy Turner, Office of
Health Plan Standards and Compliance Assistance, Employee Benefits
Security Administration, (202) 693-8335. This is not a toll-free
number.
SUPPLEMENTARY INFORMATION:
I. Background
The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA)
created the health care continuation coverage provisions of title I of
the Employee Retirement Income Security Act of 1974 (ERISA), the
Internal Revenue Code (Code), and the Public Health Service Act (PHS
Act). These provisions are commonly referred to as the COBRA
continuation provisions, and the continuation coverage that they
mandate is commonly referred to as COBRA continuation coverage. Group
health plans subject to the COBRA continuation provisions are subject
to ARRA's premium reduction provisions, notice requirements, and an
additional election period. The COBRA continuation coverage provisions
do not apply to group health plans sponsored by employers with fewer
than 20 employees. Many States require health insurance issuers who
provide group health insurance coverage to plans not subject to the
COBRA continuation provisions to provide comparable continuation
coverage. Such continuation coverage provided pursuant to State law is
also subject to ARRA's premium reduction provisions and notice
requirements but not the additional election period.
II. Description of the Model Notices
a. In General
ARRA mandates the provision of three notices--a ``General Notice,''
an ``Alternative Notice,'' and a ``Notice in Connection with Extended
Election Periods.'' Each of these notices must include: a prominent
description of the availability of the premium reduction including any
conditions on the entitlement; a model form to request treatment as an
``Assistance Eligible Individual'';\1\ the name, address, and telephone
number of the plan administrator (and any other person
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with information about the premium reduction); a description of the
obligation of individuals paying reduced premiums who become eligible
for other coverage to notify the plan; and (if applicable) a
description of the opportunity to switch coverage options. The Notice
in Connection with Extended Election Periods must also include a
description of the extended election period.
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\1\ In general, an ``Assistance Eligible Individual'' is an
individual who is eligible for COBRA continuation coverage as a
result of an involuntary termination of employment at any time from
September 1, 2008 through December 31, 2009; and who elects COBRA
coverage (when first offered or during the additional election
period).
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The Department of Labor (the Department) created these model
notices to cover an array of situations in order to deal with the
complexity of the various scenarios facing dislocated workers and their
families. In an effort to ensure that the notices included all of the
information required under ARRA while minimizing the burden imposed on
group health plans and issuers, the Department created several
packages. Each package is designed for a particular group of qualified
beneficiaries and contains all of the information needed to satisfy the
content requirements for ARRA's notice provisions. The packages include
the following disclosures:
A summary of ARRA's premium reduction provisions.
A form to request the premium reduction.
A form for plans (or issuers) who permit qualified
beneficiaries to switch coverage options to use to satisfy ARRA's
requirement to give notice of this option.
A form for an individual to use to satisfy ARRA's
requirement to notify the plan (or issuer) that the individual is
eligible for other group health plan coverage or Medicare.
COBRA election forms and information, as appropriate.
b. General Notice
The General Notice is required to be sent by plans that are subject
to the COBRA continuation provisions under Federal law.\2\ It must
include the information described above and be provided to ALL
qualified beneficiaries, not just covered employees, who have
experienced a qualifying event at any time from September 1, 2008
through December 31, 2009, regardless of the type of qualifying event.
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\2\ Under ARRA the Secretary generally is responsible for
developing all of the model notices with the exception of model
notices relating to Temporary Continuation Coverage under 5 U.S.C.
8905a, which is the responsibility of the Office of Personnel
Management (OPM). In developing these notices, the Department has
consulted with the Departments of the Treasury and Health and Human
Services, OPM, the National Association of Insurance Commissioners,
and plan administrators and other entities responsible for providing
COBRA continuation coverage.
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The Department has created two versions of this notice. The
abbreviated version is for individuals who have elected COBRA and are
still covered after experiencing a qualifying event at some time on or
after September 1, 2008 to advise them of the availability of the
premium reduction and other rights and obligations under ARRA. The
longer version includes all of the information related to the premium
reduction and other rights and obligations under ARRA as well as all of
the information required in an election notice required pursuant to the
Department's final COBRA notice regulations under 29 CFR 2590.606-
4(b).\3\ Providing the longer notice to individuals who have
experienced a qualifying event from September 1, 2008 through December
31, 2009 will satisfy the Department's existing requirements for the
content of the COBRA election notice as well as those imposed by ARRA.
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\3\ ARRA provides that COBRA election notices already provided
for qualifying events occurring during this time period but which
did not include information on the availability of the premium
reduction are not complete. As such, the end of the 60-day period
for electing COBRA continuation coverage is measured from when a
complete notice is provided. Moreover, although under COBRA a timely
election may require a plan to make coverage available retroactively
to the date of the loss of coverage, ARRA provides no new
requirement for a plan to allow an individual to elect COBRA
continuation coverage for any period prior to the first coverage
period beginning on or after February 17, 2009.
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c. Alternative Notice
The Alternative Notice is required to be sent by issuers that offer
group health insurance coverage that is subject to continuation
coverage requirements imposed by State law. The Alternative Notice must
include the information described above and be provided to ALL
qualified beneficiaries, not just covered employees, who have
experienced a qualifying event at any time from September 1, 2008
through December 31, 2009, regardless of the type of qualifying event.
Continuation coverage requirements vary among States. Thus, the
Department crafted a single version of this notice that should be
modified to reflect the requirements of the applicable State law.
Issuers of group health insurance coverage subject to this notice
requirement should feel free to use the model Alternative Notice or the
abbreviated model General Notice (as appropriate).
d. Notice in Connection With Extended Election Periods
The Notice in Connection with Extended Election Periods is required
to be sent by plans that are subject to COBRA continuation provisions
under Federal law. It must include the information described above and
be provided to any Assistance Eligible Individual (or any individual
who would be an Assistance Eligible Individual if a COBRA continuation
coverage election were in effect) who: had a qualifying event at any
time from September 1, 2008 through February 16, 2009; AND either did
not elect COBRA continuation coverage or who elected but subsequently
discontinued COBRA. This notice MUST be provided by April 18, 2009,
which is 60 days after the date ARRA was enacted.\4\
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\4\ ARRA could be read to require Assistance Eligible
Individuals with qualifying events from September 1, 2008 through
February 16, 2009 who are already enrolled in COBRA coverage to
receive both a General Notice and a Notice in Connection with
Extended Election Periods with duplicate content. Because the COBRA
election information would be of no practical importance to
individuals already enrolled, plans may send just the abbreviated
General Notice to such individuals and satisfy both ARRA notice
requirements if the 60-day time frame for providing the Notice in
Connection with Extended Election Periods is satisfied.
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III. For Additional Information
For additional information about ARRA's COBRA premium reduction
provisions, contact the Department's Employee Benefits Security
Administration's Benefits Advisors at 1-866-444-3272. In addition, the
Employee Benefits Security Administration has developed a dedicated
COBRA Web page http://www.dol.gov/COBRA that will contain information
on the program as it is developed. Subscribe to this page to get up-to-
date fact sheets, FAQs, model notices, and applications.
IV. Paperwork Reduction Act Statement
According to the Paperwork Reduction Act of 1995 (Pub. L. 104-13)
(PRA), no persons are required to respond to a collection of
information unless such collection displays a valid Office of
Management and Budget (OMB) control number. The Department notes that a
Federal agency cannot conduct or sponsor a collection of information
unless it is approved by OMB under the PRA, and displays a currently
valid OMB control number, and the public is not required to respond to
a collection of information unless it displays a currently valid OMB
control number. See 44 U.S.C. 3507. Also, notwithstanding any other
provisions of law, no person shall be subject to penalty for failing to
comply with a collection of information if the collection of
information does not
[[Page 11973]]
display a currently valid OMB control number. See 44 U.S.C. 3512.
This Notice revises the collections of information contained in the
ICR titled Notice Requirements of the Health Care Continuation Coverage
Provisions approved under OMB Control Number 1210-0123. OMB has
approved this revision to the ICR pursuant to the emergency review
procedures under 5 CFR 1320.13. The public reporting burden for this
collection of information is estimated to average approximately 7
minutes per respondent, including time for gathering and maintaining
the data needed to complete the required disclosure. Interested parties
are encouraged to send comments regarding the burden estimate or any
other aspect of this collection of information, including suggestions
for reducing this burden, to the U.S. Department of Labor, Office of
the Chief Information Officer, Attention: Departmental Clearance
Officer, 200 Constitution Avenue, NW., Room N-1301, Washington, DC
20210 or e-mail DOL_PRA_PUBLIC@dol.gov and reference the OMB Control
Number 1210-0123.
V. Models
The Department has decided to make the model notices available in
modifiable, electronic form on its Web site: http://www.dol.gov/COBRA.
VI. Statutory Authority
Authority: 29 U.S.C. 1027, 1059, 1135, 1161-1169, 1191c; Public
Law 111-5, 123 Stat. 115; sec. 3001(a)(5), 3001(a)(2)(C),
3001(a)(7), and Secretary of Labor's Order No. 1-2003, 68 FR 5374
(Feb. 3, 2003).
Signed at Washington, DC this 17th day of March 2009.
Alan D. Lebowitz,
Deputy Assistant Secretary, Employee Benefits Security Administration.
[FR Doc. E9-6131 Filed 3-19-09; 8:45 am]
BILLING CODE 4510-29-P
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