DOL ISSUES UPDATED COBRA NOTICES AND FAQS

The Department of Labor has posted new model general and election COBRA notices and a short series of FAQs about the model notices.  The revisions do not change application of COBRA. Rather, they provide clarification to employees about the interaction between Medicare and COBRA. The notices make it clear that employees who become eligible for Medicare while they are working may enroll immediately, or they may delay enrollment to an eight-month special enrollment window that starts at the earlier of: 1) the date that the employee’s employment terminates; or 2) the date that the employee’s group health plan coverage through the employee’s employment terminates (which would include COBRA coverage). If an employee terminates employment, elects COBRA coverage, and delays signing up for Medicare for at least eight months after termination, the employee may be subject to a Part B late enrollment penalty and/or a gap in coverage when the employee eventually signs up for Part B Medicare coverage. If an employee elects Medicare coverage while receiving COBRA coverage, the employer’s group health plan may terminate the employee’s COBRA coverage. However, if an employee is already enrolled in Medicare Part A or B before the date that the employee enrolls in COBRA, then COBRA coverage does not terminate on account of the Medicare enrollment. Medicare will generally pay first (i.e., will be the primary payer) and COBRA will pay second when both Medicare and COBRA cover the same health expenses.

The updated notices and FAQs may be found here. While use of the DOL model COBRA notices is not mandatory, use of them is considered good faith compliance by the DOL.

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