ARRA COBRA Updates Based on DOL Model Notices
Category: 2009 Stimulus
Topics: arra, traviscobra, webcobra
On March 19, 2009, the DOL issued model notices for COBRA as required by the 2009 Stimulus package (ARRA). Both TravisCobra and WebCOBRA have been producing letters as detailed by the final bill’s language. The DOL Model Notices are a formalization of our community of users’ beliefs as to how WebCOBRA and TravisCobra should function.
Here are the two changes we will be making to TravisCobra and WebCOBRA within the next week:
Disclosure Statement and AEI Request
Two forms were created by the DOL in the model notices- Disclosure Statement: Describes to the participant what ARRA is and how it could potentially impact their premiums. Lists government contacts and websites.
- AEI Request Form: This form is designed for the QB to fill out and send back to the Administrator.
Both forms will print automatically in the following scenarios: - Re-notification Letter Sets
- All Events regardless of type from 2/17/2009 through 12/31/2009
If you already printed re-notification letters, you will be able to resend ARRA Enrollment Forms via Manual Letters (WebCOBRA) or the Forms (TravisCobra). This will send the Disclosure Statement and AEI Request Form to your participant.
Wording Additions to the Cobra Election Notice
The DOL model notices have three paragraphs we recommend you add to the Cobra Election Notice. You can do so now, or wait for the release to be added. Here are the three paragraphs
The American Recovery and Reinvestment Act of 2009 (ARRA) reduces the COBRA premium in some cases. You are receiving this election notice because you experienced a loss of coverage that occurred during the period that begins with September 1, 2008 and ends with December 31, 2009 and you may be eligible for the temporary premium reduction for up to nine months. To help determine whether you can get the ARRA premium reduction, you should read this notice and the attached documents carefully. In particular, reference the “Summary of the COBRA Premium Reduction Provisions under ARRA” with details regarding eligibility, restrictions, and obligations and the “Application for Treatment as an Assistance Eligible Individual.” If you believe you meet the criteria for the premium reduction, complete the “Application for Treatment as an Assistance Eligible Individual” and return it with your completed Election Form.
Under ‘How much does COBRA continuation coverage cost?’
The American Recovery and Reinvestment Act of 2009 (ARRA) reduces the COBRA premium in some cases. The premium reduction is available to certain individuals who experience a qualifying event that is an involuntary termination of employment during the period beginning with September 1, 2008 and ending with December 31, 2009. If you qualify for the premium reduction, you need only pay 35 percent of the COBRA premium otherwise due to the plan. This premium reduction is available for up to nine months. If your COBRA continuation coverage lasts for more than nine months, you will have to pay the full amount to continue your COBRA continuation coverage. See the attached “Summary of the COBRA Premium Reduction Provisions under ARRA” for more details, restrictions, and obligations as well as the form necessary to establish eligibility.
Regarding the TAA Changes
The Trade Act of 2002 created a tax credit for certain individuals who become eligible for trade adjustment assistance and for certain retired employees who are receiving pension payments from the Pension Benefit Guaranty Corporation (PBGC). Under the tax provisions, eligible individuals can either take a tax credit or get advance payment of 65% of premiums paid for qualified health insurance, including continuation coverage. ARRA made several amendments to these provisions, including an increase in the amount of the credit to 80% of premiums for coverage before January 1, 2011 and temporary extensions of the maximum period of COBRA continuation coverage for PBGC recipients (covered employees who have a nonforfeitable right to a benefit any portion of which is to be paid by the PBGC) and TAA-eligible individuals.
Implementation Dates
We will release a new version of TravisCobra to users no later than Friday, March 27, 2009. An updated version of WebCOBRA will be installed no later than Saturday, March 28, 2009.
72 Responses to “ARRA COBRA Updates Based on DOL Model Notices”
Comments are closed for this article.
March 20th, 2009 at 05:16 PM
We have already requested our renotification letters through the wizard for those QB’s with QE’s 09/01/2008 – 02/17/2009, but we cannot determine how to request the same type of notification packet for those QB’s who have been entered and are in status of Notified Waiting for Response with QE’s after 02/17/2009. Please advise if this is currently an option or if it will be updated for processing on the next modification? Thank you
March 23rd, 2009 at 01:40 PM
Jesse, We have a couple of questions… 1 from our last week training session… in the renotifications, how is the system assigning plans to the QB’s? Since most of our large employers offer annual enrolment as of 1/1, how does the system generate an automated notice with plans and rates if the benefits that were available 9/1/ – 1/1 are no longer available?
My folks are advising that they cannot download files into the system from our larger accounts because a new required field has been added for ARRA eligible – it is a True / False field. Most of our employers are having to go back and review events and do not know at this time …it is also our understanding that the notices containing ARRA information are reqquired for everyone with an event from 9/1/08-12/31/09 so the field would not be required.
Finally, since we moved our final accounts to the Web system from the Desktop system as of 2/1, we need some assistance on how we are suppose to send notices out of the Desktop system, when everyone now shows terminated even if they were enrolled when we moved them over. will this be a manual process for us?
March 23rd, 2009 at 03:23 PM
@Amanda: You will not want to re-notify these QBs of ARRA, but you can send them an ARRA Enrollment form using the Manual Letter Wizard. After this weekend that will also include the DOL’s form and application, so you could consider waiting until then.
March 23rd, 2009 at 03:24 PM
@Kelly: The system can only assign plans that it knows about; updating these records will be a manual process for you. The ARRA field was required by accident and is no longer required. Please contact support on upgrading your Desktop system and running the renotification wizard in TravisCobra.
March 23rd, 2009 at 03:30 PM
Sarah Could you please explain the following comment you made to Kelly: The ARRA field was required by accident and is no longer required. Are you now saying that the COBRA downloader does not need to be modified and we will not have to load this new field?
Thanks Karen
March 23rd, 2009 at 03:41 PM
@Amanda In Web COBRA the ARRA enrollment form only appears in the list of letters to order manually in the Correspondence tab in the QB detail, it is not in the Send Letters Manually list of letters. We had to run a report to identify who was notified after 02/17/09 and in their election period, by client. We will then have to order the letters under each QB detail in the Correspondence tab. It would be easier if the ARRA Enrollment Form was on the list of Letters to send manually but then the population Notified Waiting for Response would also have to be added. We have, as of today 354 ARRA Enrollment Forms to order manually.
March 23rd, 2009 at 03:43 PM
Sarah Based on your reply to Sarah, are we no longer required to change our COBRA downloader and add the new field?
Thanks Karen
March 23rd, 2009 at 03:49 PM
@Karen: Your files should no longer fail to load if field 180 is not present, which was happening. You may need to still change your files to get the result you want
March 23rd, 2009 at 03:51 PM
@Lyn: The ARRA Enrollment Form is available on the Send Letters Manually to QBs. If it still does not show for you, please contact support.
March 23rd, 2009 at 04:16 PM
I know the system is in the process of being updated, so maybe I shouldn’t be processing anything, but I just noticed a situation and wanted to see everyone’s interpretation of this. If an employee is involuntarily terminated and sent COBRA (with the reduced premium amounts), but only his spouse wants to elect coverage, is the spouse eligible for the subsidy? When I drop the EE in WebCOBRA and only enroll the spouse as QB Only, the premiums are no longer reduced by the subsidy. Is this how it should work?
March 23rd, 2009 at 04:31 PM
I sent a request to support to look into this for me. Just to be sure I understand, I’m looking for the ARRA enrollment Form in the Send Letters Manually Menu. I realize that it is under each individual QB record’s correspondence tab.
March 23rd, 2009 at 08:58 PM
We have several groups that will offer a lower plan to the AEI. We now believe that the option is available not only during the re-enrollment period but through 12/31/09. Our legal dept indicates this wording must be included in the notice. How can we turn this specific wording on and off by customer?
March 23rd, 2009 at 09:07 PM
Our Legal Dept has reviewed the model notice and agree with the 3 new paragraphs. They would like to put those 3 paragraphs in different places in our standard notices but there is only one block available to alter our standard notice. Can you provide 2 additional blocks so we can insert these paragraphs into different places in our standard notice?
March 24th, 2009 at 06:13 AM
I’m not sure I understand why the re-notification process does not include QB’s with an entry date after 2/17? These QB’s are also eligible to be notified of the subsidy and because we had to enter them prior to the upgrade nothing has been sent related to the new law. We have 85 clients and as of right now there have been 917 QB entered since 2/18. Are you saying we have to manually go into each of those 917 records and send a manual letter on top of re-notifying all of the other QB’s all the way back to 9/1? Is there an easier way to do this?
March 24th, 2009 at 08:34 AM
I have wo questions…
1) (For terms going forward, not re-notification) You state that the ARRA feild does not need to be filled out it was there on accident. We use the CSV file. When we upload a file, with the new DOL notices, are we going to need to enter something if we know the person is ARRA eligible, or are the new notices going to automatically include the ARRA information and regular rate and subsidy rate? Or, should we still use that feild in the CSV file for ones we know are eligible?
2) On the ARRA report, if I did a date range of 3/1/2009-3/31/2009, on 4/10/2009. Would it pull only payments made in March, or only payments made FOR March. I am concerned somoene may make a payment for March on 4/2/2009, due to mailing time or a weekend, and I want to know that it will show up on the March date range and not the April?
March 24th, 2009 at 08:45 AM
As a TPA we have chosen to wait until all updates are completed in WEBCOBRA to notify our participants. However, the WEBCOBRA site now appears to allow clients to select Involuntary Termination as a term reason, and produce notices that do not include the forms required or the updated language. (actually it’s not printing any enrollment forms). Can this feature be disabled until the notices are completed to include enrollment forms and ready for production next week? Thank you.
March 24th, 2009 at 09:29 AM
@Renee: Our interpretation is that the spouse only is also eligible for the subsidy. Please contact Travis Support if you continue having issues with applying the subsidy to this type of QB.
March 24th, 2009 at 09:31 AM
@Sharon: You can create the wording you are requesting in either the Internet Word Processor or the Letter Writer, depending on which system you are utilizing.
March 24th, 2009 at 09:33 AM
@Sharon: You can enter product enhancement ideas to the Travis Ideabook at http://ideabook.travisoft.com/ so we can evaluate them more accurately. Thanks!
March 24th, 2009 at 09:43 AM
@Lyn: On the second step of the Manual Letter Wizard, when you are given the choice of what letter to send, in the drop down menu there is an “ARRA Enrollment Form”, so you will want to choose that if you want to send the ARRA Enrollment Form to QBs. If you can’t find it, please contact Travis Support.
March 24th, 2009 at 09:47 AM
@Cara: The reason is because you don’t have to re-notify them. You can choose to use the Manual Letter Wizard, selecting events Post ARRA, and/or Forms in TravisCobra to send them the ARRA Enrollment Form.
March 24th, 2009 at 10:06 AM
@Adella: For the CSV file, you will need to identify if the QB is ARRA eligible. If you don’t, then the QB will not be informed of their right to the subsidy. For the report, it would only pull the ARRA subsidies for March, based on this scenario.
March 24th, 2009 at 10:09 AM
We have an employee who will be terminated this week. The company will pay three months COBRA payments for the employee. However, we are self insured and there is actually no exchange of monies on our part. Do we claim the payment at regular premium or at the subsidy rate? And do we claim subsidy reimbursement for those three months. Also, how long does the employee have on the subsidy, would it be nine months following the three months or six months following the three. IF we were to pay the three months at regular premium, would the employee have the nine months following?
March 24th, 2009 at 10:12 AM
THANK YOU VERY MUCH! I had been trying to figure out how to send the ARRA enrollment form to events after 02/17/09 without having to order each one individually. I guess I wasn’t making my question clear! You have solved this “wake up in the middle of the night” issue!
March 24th, 2009 at 10:25 AM
Sarah – by selecting that event it will pull only those that were entered after 2/17? Lyn – I am so there with you – I was up at 1 AM worried about this!
March 24th, 2009 at 10:47 AM
We are still having isssues with the HRA’s not showing with the subsidy amount. Our office contact SHRM and they gave us the following: Here’s what you requested: Are HRA plans eligible for the COBRA subsidy offered through the stimulus package? If so, has the DOL released this in writing? Here’s what we can provide: Based on the information provided by a law firm (see below), yes HRAs are eligible for the subsidy. I find no specific evidence that as of yet the DOL has released this information in writing.
Generally, all group health plans subject to COBRA constitute eligible coverage for purposes of the subsidy. For example, medical, dental, vision, and
health reimbursement arrangements qualify as eligible coverage. In contrast, health flexible spending arrangements are not eligible coverage for purposes of the subsidy. Coverage under state law that requires continuation coverage comparable to the continuation coverage required under Federal COBRA rules is also eligible coverage, as is continuation of coverage under requirements that apply to health plans maintained by the Federal government or a state government.
March 24th, 2009 at 10:52 AM
When will the denial letter for the subsidy be ready?
Thanks
March 24th, 2009 at 12:17 PM
For the QB’s that we have notified after 2/17 thru today can you give me the steps on renotifying them. I’m still alittle unclear on this. I too thought it would be a manual process. Thank you.
March 24th, 2009 at 12:50 PM
@Daisy: Unfortunately there is no way to disable this feature.
March 24th, 2009 at 12:53 PM
@Karen: The denial letter for the subsidy will go out with the release scheduled for the end of this week.
March 24th, 2009 at 01:00 PM
@Sandi: It is our interpretation that the Employer can claim the subsidized rate if you pay any part of the QBs COBRA coverage; however, the QB can only receive 9 months of coverage, whether your company pays for it or not.
March 24th, 2009 at 01:00 PM
@Sandi: It is our interpretation that the Employer can claim the subsidized rate if you pay any part of the QBs COBRA coverage; however, the QB can only receive 9 months of coverage, whether your company pays for it or not.
March 24th, 2009 at 01:04 PM
@Danielle: Please contact Travis Support regarding this issue. We are unable to diagnose potential issues over the Blog.
March 24th, 2009 at 01:24 PM
@Cindy: You should run the ARRA Re-notification process, which will process any enrolled, termed and pending QB with an event date on or after 09/01/2008. This will create letters for the QBs that will notify them that they MAY be eligible for the ARRA subsidy. Terminated QBs will have a new pending record created in WebCOBRA. Pending QBs will have their prior record terminated and a new pending record created. Enrolled QBs will have an enrollment form printed notifying them that they may be eligible for the 65% ARRA subsidy.
March 24th, 2009 at 01:28 PM
@Cara: You don’t have to go back to each record to Re-Notify them. You can use the Re-Notification wizard as long as the event date is on or after 09/01/2008, the QBs are not already marked as ARRA eligible, and they have not already been Re-Notified. If the wizard is still not picking up someone you think it should, please call Travis Support.
March 24th, 2009 at 02:25 PM
Sarah, I thought the wizard only captured the QB’s from 9/1 thru 2/17/09. Are you stating that once I run the re-notification wizard it will also capture the QB’s we entered after 2/17/09 up thru til Monday when the release comes out.
March 24th, 2009 at 02:59 PM
When we complete the re-notifcation should the adjusted premium be reflected on the premium computation form and if not, how and when is the enrollment confirmation printed that reflects the adjusted 65% reduced premium {Block 38).
March 24th, 2009 at 03:17 PM
The IRS published a Q&A regarding the Subsidy on 2/26/09. The third answer outlined the supporting documentation to be maintained for the credit claimed. Will Travis modify the ARRA premium report or add a new report to capture the requested data?
March 24th, 2009 at 03:25 PM
If the QE is in December 2009 and the QB qualifies for the subsidy, do they receive 9 months at the 35% rate starting 1-1-2010?
March 24th, 2009 at 03:33 PM
@Leslie: The report currently shows the information we believe is needed.
March 24th, 2009 at 03:44 PM
@Cindy: In WebCOBRA, the Re-Notification wizard will only capture QBs from 9/1/2008 – 2/17/2009.
March 24th, 2009 at 03:47 PM
@Janet: Yes, if the term method is End of Month.
March 24th, 2009 at 04:11 PM
When I go to use the Re-notification process, the system still does not print out letters for termed employees that are eligible. What step am I missing?
March 24th, 2009 at 04:29 PM
@Marilyn: The adjusted premium will not show in the system until the qb is ARRA verified, but you can add Block 039 to the enrollment form and it will show the adjusted premium and full premium.
March 25th, 2009 at 06:05 AM
Sarah, This is my question. How do I capture the QB’s that are in the system after the date of 2/17 to notify them of the ARRA?
March 25th, 2009 at 07:40 AM
I am not certain how to add a block, as stated above you suggested adding block 039 to show both premiums. Will you please explain how this is done in TravisCobra? Thank you.
March 25th, 2009 at 08:18 AM
Does Travis COBRA 8.3.09 include the latest DOL updates or will there be a version 8.3.10?
March 25th, 2009 at 09:16 AM
@Laura: The DOL updates will be released in 8.3.0.10.
March 25th, 2009 at 09:36 AM
@Rebecca: When running Re-Notification, please make sure you have chosen the event type of Terminated. If you have selected this event type and these terminated QBs are still not picked up, please contact Travis Support.
March 25th, 2009 at 10:15 AM
@Cindy: In the WebCOBRA Manual Letter Wizard, there is a selection for ‘QBs that are ARRA stimulus eligible with Event Dates past 02/17/2009’.
March 25th, 2009 at 11:00 AM
I’m still confused, or missing something. The DOL General Notice includes the full premium and the ARRA premium and is to be sent to:
General Notice (Full version) Plans subject to the Federal COBRA provisions must send the General Notice to all qualified beneficiaries, not just covered employees, who experienced a qualifying event at any time from September 1, 2008 through December 31, 2009, regardless of the type of qualifying event, AND who either have not yet been provided an election notice or who were provided an election notice on or after February 17, 2009 that did not include the additional information required by ARRA. This full version includes information on the premium reduction as well as information required in a COBRA election notice.
That seems clear to me that the ARRA premium should appear in every COBRA notification regardless of event from this point forward.
If I understand correctly, the ARRA premium is only available in Web COBRA after the QB is selected as ARRA eligible, or, if on entry into the system on the Prior Activity Screen we select to send the ARRA Enrollment Form.
IS that correct?
March 25th, 2009 at 11:17 AM
I authorized stimulus for someone and it produced the Stimulus Confirmaiton Letter. In the letter it states “must receive your initial premium payment as shown on the enclosed form” What form is this referring to or are we supposed to manually produce a form?
March 25th, 2009 at 11:59 AM
Sarah, based on your answer to Marilyn. I am having the same issue. I have downloaded someone on the CSV file to be ARRA eligible and it does calculate the correct rate on the enrollent, but not on the Premium Computation form, nor the enrollment tier, they are still showing the full rate, is this something that will be corrected in the dowload this weekend. I am having to manually updated these letters.
March 25th, 2009 at 01:52 PM
@Tina: B039 is only available to be inserted on the ARRA Enrollment Form. To insert a block in TravisCobra, go to the Letter Writer under the Utility Menu. Open the ARRA Enrollment Form. Once the ARRA Enrollment Form is open, go to file, open, block, and choose Block 39: ARRA Stimulus Coverage Comparison.
March 25th, 2009 at 01:56 PM
@Adella: Please contact Travis Support. We are unable to diagnose potential issues through the Blog.
March 25th, 2009 at 02:20 PM
@Helen: The form it is referring to is the ARRA Enrollment form.
March 25th, 2009 at 03:05 PM
@Lyn: We’ll be including the ARRA Disclosure Statement and the ARRA Request Form to all events within the time-period in both TravisCobra and WebCOBRA after this weekend. Your idea to be able to preset all events in this time period to be ARRA Eligible is a good idea, please add to the Ideabook and we can hopefully add it soon!
March 25th, 2009 at 04:14 PM
I wish everyone would read all the questions on the blog. A lot of these questions are duplicate, and really shouldn’t be wasting Sarah’s time.
March 25th, 2009 at 04:51 PM
I have modified the Enrollment Form in WEB Cobra with the ARRA benefit plan list. It pulls the full premium. When I contacted support, case # 28645, I was told that the ARRA Benefit List is only available on the ARRA Enrollment Form, and that requires ordering the ARRA Enrollment Form on the Prior Activity Screen, and that seems correct.
I have already modified my letters to include the Disclosure Statement, the AEI Form and I have put the Drop AEI Status in the ARRA confirmation Letter, have a different ARRA Confirmation Letter for those who are already paying premium that includes new coupons and the drop AEI form, I have used the current Denial of Coverage Letter and modified it to include the DOL wording regarding the appeal preocess. I’m ready, I am just waiting for the IRS to release the definition of “involuntary termination”, which as of yesterday they thought would be this week or next.
I am waiting to have all the correct notices and information to send any ARRA information. Which leads me to your response. The DOL requires both the full premium and the ARRA premium to appear in the General notice to be sent to ALL events from 09/01/08 thru 12/31/09. That’s what is on their WEB site and that is what was reiterated in the WEB cast yesterday from the DOL and IRS. Is there something I am missing? It seems that if Travis interprets the notice requirement as I do, it would make send to add the ARRA Benefit Paln List to the current Enrollment Form and the Premin Computation Form and have it show the subsidized premium, not the full premium as it does now. This is not a suggestion on my part it is a requirement from the DOL to comply with the regulations.
March 25th, 2009 at 09:09 PM
To get the credit the comp has to wait for the member to pay COBRA. Since you have 60 days to enroll in COBRA some people may be paying March’s premium in May. Do we have to just keep running the ARRA report to see who was not on it the last time it was pulled. I am just not clear on how the ARRA report works. It seems the report should have the date the member made the payment and for what month.
March 26th, 2009 at 07:42 AM
Good Morning…After reading through the blogs here I have read that the update will be this weekend, but in another location it states the date of prior to April 3rd for TravisCobra. Are these two different updates and if so which one will have the update for the re-notification letters? Also, when going to the FTP I am not seeing an update for 8.3.0.09. The last one in my view is from March 19th which I had thought that one was 8.3.0.08. Thank you for all of your time in answering our questions and/or concerns. It is greatly appreciated.
March 26th, 2009 at 08:54 AM
@Tina: The patch on the FTP site that was uploaded on March 19 is version 8.3.0.09. The TravisCobra update that will include the updated letters will be released on March 27 and will be version 8.3.0.10.
March 26th, 2009 at 10:10 AM
When we print the ARRA letters to re-notify termed employees there are HIPAA notices included. From what I have read with the DOL release we do not need to send HIPAA notices with the ARRA letters for those who have already been given COBRA notices. Because we recently converted from TravisSoftware to WebCOBRA we have members who need to be notified of ARRA that we are hand entering. The problem is the wrong date is appearing in the “Date Coverage Ended” field. It is across the board putting in 2/28/2009, which is incorrect for all our hand entered people. The Travis support group was not able to fix this problem. I want to be sure we are sending out the correct information and accurate information. Do we even need to send the HIPAA certificates when re-notifying?
Also according to the DOL release we have to send out State specific ARRA notices. Will this be part of the update happening this weekend?
March 26th, 2009 at 01:00 PM
@Lyn: The ARRA subsidized premium amount and the full premium amount are both available on the enrollment form. You can add the ARRA Benefit Plan list to the Premium Comp form by going into the IWP and pasting in the new data element.
March 26th, 2009 at 01:08 PM
@Adella: The ARRA report shows QBs who make payments for that month. For example, if a QB made a payment 4/2/09 for the month of March, then the payment will show up on the March ARRA report.
March 26th, 2009 at 03:35 PM
I have pasted the ARRA subsidized premium into both the regular enrollment form and the premium computation form. It looks like the subsidized premium will ONLY appear if the QB has been marked as ARRA eligible in the Action Tab.
Since we have no way of knowing if the QB is ARRA eligible and the DOL wants the Request for Treatment as an Assistance Eligible Individual form returned to determine QB eligibility, it seems the only premium the system will send is the full premium. Am I missing something?
March 26th, 2009 at 04:21 PM
@Barbara: Updates to the HIPAA notices are not part of the release that will be sent out over the weekend. Please check back as more ARRA updates evolve!
March 26th, 2009 at 04:32 PM
@Lyn: You will still need to mark the QB as eligible, which does not mean authorized, for them to show the ARRA premiums.
March 27th, 2009 at 08:06 AM
Is the latest update ready? How and when will you notify us?
Will this latest update include the fix for those that term on event date and termination was February 18 and needs the 35% prorated rate 2/18-2/28?
Will it have ALL forms needed so we won’t have to go into each PQB again to send more forms out?
Thanks!
March 27th, 2009 at 08:37 AM
@Nancy: We will notify you via the Blog when the release goes out, which will include information on the features that were added.
March 27th, 2009 at 10:50 AM
There was a new release this morning for Travis COBRA. Does this release include the changes to the COBRA election notices?
March 27th, 2009 at 12:42 PM
@Chris: The new version of TravisCobra has not been released. The latest version, 8.3.0.09, was released on 3/19/09.