The Department of Labor Publishes New COBRA Model Notices

The Consolidated Omnibus Budget Reconciliation Act of 1985 – commonly known as “COBRA” – gives certain former employees, their spouses, and dependent children the right to continue health coverage at the employer’s group rates. COBRA generally obligates both public and private employers with 20 or more employees to offer COBRA coverage when coverage is lost due to certain “qualifying events.”

COBRA requires various notices to employees during and after employment, including a “General Notice” describing COBRA rights and employee obligations and an “Election Notice” explaining the right to continuation coverage and how a qualified beneficiary can make an election. The Department of Labor publishes model notices employers can use to comply with COBRA’s notification requirements.

The DOL recently published updated versions of the model General Notice and Election Notice. The updated notices include information about the Health Insurance Marketplace established by the Affordable Care Act, a beneficiary’s right to obtain coverage through the Marketplace as an alternative to COBRA, and coverage and premium cost differences between the Marketplace and COBRA continuation coverage.

Although the updated models are based on regulations that have merely been proposed (not adopted as final), the DOL considers use of the new models to be good faith compliance with COBRA’s notice requirements. Employers are not required to use the DOL model notices, but doing so facilitates compliance with COBRA. The updated model notices can be found on the DOL’s website (www.dol.gov/ebsa/compliance_assistance.html). Because the model notices are general templates, employers should revise them as necessary to comply with state law or unique practices.

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