McNees Minute: American Rescue Plan Act

Sponsored Content: McNees Minute

Renée Lieux, Esq. – 717-237-5484

The American Rescue Plan Act requires most employers who provide group health care to fully subsidize COBRA benefits for employees who are eligible as a result of a reduction in hours or an involuntary termination of employment for reasons other than gross misconduct.  This applies to all employers who are subject to the federal COBRA rules, all employers with less than 20 employees who are subject to a state’s mini-COBRA rules, such as Pennsylvania’s mini-COBRA, and governmental employers who are subject to “public COBRA” requirements through the Public Health Services Act.  This subsidy is in effect beginning  April 1, 2021, and ends on the earlier of when 1) the employee is no longer in a COBRA coverage period, 2) the employee becomes eligible for other group health care or Medicare, or 3) September 30, 2021.  Employers are required to send out notices prior to May 31st . The Department of Labor has released model notices which can be found on its website.  For more information, please contact a member of the McNees Labor and Employment Group and plan to attend the McNees 2021 Labor & Employment Law Seminar to be held virtually in June.

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