Recently, the delay of “pay or play” and seeming disarray over implementation of the state insurance exchanges have underscored the confusion surrounding the Affordable Care Act. A lengthy list of new rules joins existing regulations that have governed the administration of health plans for years. Regulatory guidance has been uneven, and just how the ACA affects longstanding law – including COBRA – has appeared unclear.
For example, there is the misperception that COBRA no longer applies. On its website, The Department of Labor, the federal agency that regulates COBRA, states: “PPACA did not eliminate COBRA or change the COBRA rules.” Employers need to continue complying with COBRA. Misperceptions stem from the misunderstanding that exchanges will eliminate the need for COBRA. Yes, the ACA requires that exchanges be operational in states by Oct. 1, 2013. But this will be another option, not a replacement, for qualifying individuals who otherwise lack health insurance and also qualify for COBRA.
