New guidance provides relief and extensions of deadlines to employee benefit plans and participants
May 1, 2020
On April 28, the Employee Benefits Security Administration (EBSA) of the U.S. Department of Labor (DOL) and the Internal Revenue Service (IRS), referred to here collectively as the Agencies, issued a joint notice announcing the extension of certain timeframes applicable to group health plans, disability and other welfare plans and participants and beneficiaries of these plans during the COVID-19 national emergency. On the same day, the EBSA published Disaster Relief Notice 2020-01 to provide relief for employee benefit plans and service providers from certain deadlines under ERISA of 1974. the guidance given reflects the Agencies’ understanding that the COVID-19 crisis is impairing the ability of employee benefit plans and participants to comply with the standard deadlines imposed by ERISA and the Tax Code.
Joint Notice from Agencies
The joint notice extends numerous deadlines for both group health plans and retirement plans. It defines the period from March 1, 2020, through the date that is 60 days after the end of the COVID-19 national emergency, or another date announced later by the Agencies, as the “Outbreak Period.” Plans must disregard this Outbreak Period when calculating deadlines for participants and beneficiaries to exercise certain rights. This means that days during the Outbreak Period can’t be counted as part of the maximum number of days in a participant or beneficiary has to take certain actions. Additionally, days during the Outbreak Period are disregarded when calculating the deadline by which a group health plan must provide a COBRA election notice.
Specifically, days during the Outbreak Period are not counted towards the:
Group Health Plans
- 30-day period (or 60-day period in certain circumstances) for an individual to request enrollment in a group health plan due to a HIPAA special enrollment event;
- 60-day period for a qualified beneficiary to elect COBRA continuation coverage;
- 30-day grace period for a qualified beneficiary to pay COBRA premiums;
- 45-day period from election of COBRA continuation coverage to the date the first payment may be due;
- Deadline by which a group health plan must provide a COBRA election notice to qualified beneficiaries;
- Period within which a claimant may request an external review of a denial appeal; and
- Date by which a claimant may file information to perfect a request for external review
All ERISA Plans
- Period during which claimants may file a benefit claim under the plan’s claims procedure; and
- Period within which claimants may file an appeal of a claim denial.
The effect of the joint notice is to extend all of these deadlines until after the conclusion of the Outbreak Period. As of this date, the national emergency will expire July 25, 2020 (unless extended or terminated earlier by the Secretary of the U.S. Department of Health and Human Services), which means the Outbreak Period would be March 1, 2020 to September 23, 2020. As an example of this, an employee who previously declined group health plan coverage and had a baby on March 27, 2020, would have until October 23, 2020, to enroll herself and her child in coverage. Another example would be a participant who loses group health plan coverage and receives a COBRA election notice on May 1, 2020, would have until November 22, 2020, to elect COBRA.
Conclusion
As an employer, it is important that you have the expert perspective and resources to navigate this unprecedented time during this on-going crisis. Partner with MY-Employee Benefits Plus today to work through the complexities that present themselves in the area of employee benefit plans, ultimately freeing you and your key employees up to focus on continued business retention, growth and success.