On March 10, 2021, Congress put the American Rescue Plan Act of 2021 into effect. This 1.9 trillion package includes a variety of policies to provide further relief for the COVID-19 pandemic. This includes but is not limited to $1,400 checks, funding for the COVID-19 public health response, unemployment benefits, extensions of paid sick leave, state and school funding, the new child anti-poverty measures and housing assistance.

The ARP package also includes expansions for the Affordable Care Act (ACA) that will enhance marketplace access and affordability. The legislation also subsidizes COBRA continuation coverage for those individuals that were laid-off. States are also incentivized that have yet to pay their Medicare program(s).

This post will give a brief overview of the American Rescue Plan’s Final enhancements that have been made to ACA, COBRA and Medicaid/CHIP.

Affordable Care Act

– ACA subsidies will be extended to higher-income groups that do not qualify currently for the following years – 2021 & 2022
– Those who did not estimate their income properly (2020) will not have to repay excess premium tax credits at tax time
– Increase in ACA subsidies for lower-income individuals who qualified in the following years: 2021 & 2022
– Maximize ACA subsidies for those that receive unemployment benefits in 2021
– $20 million marketplace modernization
– Subsidy enhancements are only guaranteed for 2021 and 2022 but could extend further

COBRA

– The ARP will subsidize the entire cost of COBRA continuation for any individuals that were laid off or had reduced hours
– This subsidy will extend from 4/1/21 through 9/30/21
– New notices will be required of those employers that offer group health plan coverage
– Employer Groups subject to Federal COBRA rules will be required to pay the COBRA premium and be reimbursed through refundable payroll tax credits
– Effective date is 4/1/21 but those that are still within their COBRA election window are included in the subsidy

Medicare/CHIP

– New federal matching funds will be increased to promote home and community-based activities
– New 12-month post-partum (optional) coverage for new mothers
– COVID-19 vaccine and treatment coverage
– Expanded COVID-19 testing
– Rules for ACA expanded states and those that have yet to expand