COBRA Changes under the American Rescue Plan Act of 2021

President Biden signed the American Rescue Plan Act of 2021 (the Act) into law on March 11, 2021. While direct payments to certain taxpayers and extending unemployment benefits have received most of the attention in the media, the Act also provides for the federal government to pay 100% of the cost of COBRA premiums for the period beginning April 1 through September 30 (the Subsidy Period). The federal government will pay for the cost of the COBRA subsidies by providing certain tax credits to the employer in the case of self-insured medical plans or the insurer in the case of fully-insured medical plans. Read more…