The following is a list of some of the actions an employer should take to comply with the new COBRA rules:
- Identify all of the individuals who must be provided the notice required by the Act -- anyone who became entitled to COBRA on or after September 1, 2008.
- Identify the individuals who are eligible for the subsidy -- anyone who became (or becomes) entitled to COBRA on or after September 1, 2008, as a result of an employee's involuntary termination of employment.
- Prepare (or have prepared) the notice required by the Act.
- Distribute the notice required by the Act no later than April 18, 2009, to anyone who became entitled to COBRA on or after September 1, 2008.
- Offer a second COBRA election period to individuals eligible for the subsidy who previously declined COBRA continuation coverage or lost COBRA continuation coverage due to a failure to pay the premiums.
- Determine the premium that must be paid by individuals eligible for the subsidy.
- Determine what processes and procedures will need to be revised and/or implemented to recover the 65% premium subsidy -- for each payroll reporting period during which the employer receives reduced COBRA premiums from assistance eligible.
- Develop procedures and processes to identify and track assistance eligible individuals and, if applicable, notify the COBRA administrator of the assistance eligible individuals.
- Maintain supporting documentation for the premium subsidy taken as a credit against the employer's payroll withholding taxes.
The Act dramatically changes COBRA obligations in situations where the qualifying event is an involuntary termination.