Employers will have to rush to comply with notice provisions and other provisions in the American Recovery and Reinvestment Act and the Children’s Health Insurance Program Reauthorization Act.
Benefits compliance advisors and outsourcing firms are sending bulletins warning employers to get to work on accommodating the changes.
Corporate Synergies Inc., Mount Laurel, N.J., notes that employers will have to try to make many significant changes included in ARRA by March 1.
ARRA, also known as the economic stimulus bill, will require the government to subsidize laid-off employees’ purchases of Consolidated Omnibus Budget Reconciliation health coverage continuation benefits by paying 65% of the premiums.
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Employees will have to pay 35% of the premiums, but employers or plan administrators will have to administer the subsidy program.
In addition to providing subsidies for newly laid-off workers, ARRA creates a second chance for individuals to elect COBRA benefits for those who recently declined continuation coverage, Corporate Synergies says.
Another ARRA provision increases the transit pass limit to $230.
Employers will have to make employees aware of the transit pass limit increase by March 1, and they also will have to use notices and inserts to let workers and laid-off workers know about the new COBRA subsidy, Corporate Synergies says.
“To manage the federal [COBRA] subsidy, you will need to have a way of tracking the total COBRA premiums less the subsidy,” Corporate Synergies writes. “This tracking report will be used to calculate how much to reduce your employment taxes.”