Archived Insight | May 1, 2020
The Departments of Labor (DOL) and Treasury, in coordination with the Department of Health and Human Services (HHS), have released a final rule to extend certain pre-established deadlines for plans and individuals. This relief applies to group health plans, disability plans and their participants and beneficiaries. Extended deadlines relate to the issuance of certain notices and changes in eligibility and enrollment, including COBRA election rights.
The extended deadlines will help prevent participants and beneficiaries from losing rights and benefits under the plan. They will also help ease the administrative burden faced by plan sponsors and administrators as they navigate workforce staffing changes and disruption to normal business routines.
Although not required to do so, plan sponsors may wish to consider notifying participants about these deadline extensions in order to assure that participants understand their rights and to assure that implementation of the rules is clear for benefits administrative staff. Notification could be made through a benefits website, newsletters or other communications.
The relief the guidance provides will be effective immediately upon publication in the May 4, 2020 Federal Register.
Specifically, in determining certain deadlines, group health and disability plans must disregard the “Outbreak Period” — the period that began on March 1, 2020, when a National Emergency related to COVID-19 was declared and will end 60 days after the end of the emergency (or on another date issued by the Departments in the future).
The extended deadlines are related to:
Group health plans must allow individuals to enroll in the plan based on loss of eligibility for other coverage or acquisition of a new dependent for up to 30 days after the end of the Outbreak Period, although participants must pay any applicable premiums for coverage (60 days in the event of a special enrollment because of loss of coverage under Medicaid or the Children’s Health Insurance Program).
Plans must extend deadlines under COBRA without regard to the Outbreak Period, including:
Group health plans, including those with disability benefits, must extend deadlines for filing claims and appeals without regard to the Outbreak Period, including:
In a separate notice issued by the DOL, EBSA Disaster Relief Notice 2020-01, the Department provides flexibility under certain additional ERISA provisions. Among other things, the guidance includes extended time frames for ERISA disclosures, such as Summary Plan Descriptions and for filing the Form M1. This guidance is discussed in our compliance news, DOL Filing Deadlines & Fiduciary Relief for Retirement Plans. The DOL also issued COVID-19 Answers to Frequently Asked Questions (FAQs) on health and retirement benefit issues, which is that directed to participants and beneficiaries.
The final rule acknowledges that to the extent there are different Outbreak Period end dates for different parts of the country, the Departments will issue additional guidance regarding the application of the relief.
There is no similar statutory authority permitting HHS to extend deadlines applicable to plan enrollees or plan sponsors of public sector plans. As a result, HHS is encouraging plan sponsors of such plans to provide relief similar to that specified in this notice to their enrollees. HHS also encourages states and health insurers to operate in a manner consistent with the relief provided in this final rule.
Plan sponsors should assure that their administrator does not improperly deny enrollment, terminate coverage or process a claim or appeal without considering these new deadlines. Plan sponsors should stay abreast of the date the Outbreak Period will end, which may be different in different parts of the country. They should also be alert to an influx of claims, appeals and elections after the Outbreak Period ends.
The information on this webpage is preliminary and subject to revision after guidance is issued. On all issues involving the interpretation or application of laws and regulations, plan sponsors should discuss the issues raised here with their legal, tax and other advisors before determining how they apply to their specific situation.
This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.
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