DOL New Guidance Clarifying The Deadline of Relief For Health Plans and Participants

DOL New Guidance Clarifying The Deadline of Relief For Health Plans and Participants

On February 26, 2021, the Department of Labor (DOL) issued EBSA Disaster Relief Notice 2021-01 (“the Notice”), that clarified the timeframes for the extension of various deadlines associated with employee benefit plan administration. The DOL issued this Notice in response to stakeholder inquiries about the continuation of relief currently in effect and whether it was expiring.

Understanding the New Guidance

As background, the Notice provides interpretation and guidance concerning a Joint Rule issued by the DOL and Treasury on April 28, 2020, that provided for the immediate, but temporary, extension of certain benefit timeframes and associated deadlines. Employee benefit plan provisions where individuals have been able to delay taking any action include:

  • The 30-day period (or 60-day period, if applicable) to request special enrollment for employee, spouse or child during a plan or policy years
  • The 60-day election period to elect COBRA continuation coverage
  • The date for making COBRA premium payments
  • The date for individuals to notify the plan of a qualifying event or determination of disability
  • The date within which individuals may file a benefit claim under the plan’s claims procedure.
  • The date within which claimants may file an appeal of an adverse benefit determination under the plan’s claims procedure.
  • The date within which claimants may file a request for an external review after receipt of a final internal adverse benefit determination.
  • The date within which a claimant may file information to perfect a request for external review upon a finding that the request was not complete pursuant to applicable appeal rules.
  • An extension for a Plan sponsor or fiduciary to timely furnish certain notices, disclosures, or documents.

What You Need to Know About the New Guidance

The extension was effective as of March 1, 2020, and pauses the individual deadlines noted above until 60 days after the COVID-19 National Emergency (known as the “Outbreak Period”). Because the National Emergency is ongoing, this new guidance provides clarity that the ‘relief’ extended by the Joint Rule, is subject to an ERISA rule that limits any emergency extension to 12 months. As a result, all applicable deadlines subject to the relief are suspended until the earlier of: (1) one year from the date of the individual’s original deadline; or (2) the end of the Outbreak Period.

Situational Examples Provided by Notice 2021-01:

  • If a qualified beneficiary would have been required to make a COBRA election by March 1, 2020, that requirement was delayed until February 28, 2021, which is the earlier of one year from March 1, 2020 or the end of the Outbreak Period.
  • If a qualified beneficiary would have been required to make a COBRA election by March 1, 2021, their election deadline is the earlier of one year from that date (i.e., March 1, 2022) or the end of the Outbreak Period.
  • If a plan would have been required to furnish a notice or disclosure by March 1, 2020, the relief would end with respect to that notice or disclosure on February 28, 2021. The responsible plan fiduciary would be required to ensure that the notice or disclosure was furnished on or before March 1, 2021 (or, as is stated in a Notice footnote: “as soon as administratively practicable”).

Additional Examples:

  • If an individual’s date of marriage was May 1, 2020 and the plan has a 30-day special enrollment provision for that event, they have until May 1, 2021 to enroll their spouse; likewise, if the deadline to decide was May 31, 2020, the individual now has until May 31, 2021 to decide.
  • On April 1, 2020, a plan participant receives medical treatment. The health plan provides that claims must be submitted within one year of treatment. The participant’s claim will meet timely filing requirements if submitted by April 1, 2022.
  • If a plan participant was otherwise required to file a claim appeal by February 1, 2021, that deadline is delayed by one year from that date, or to February 1, 2022.

IMPORTANT: In all cases, any deadline extension ends on the date the Outbreak Period ends, if sooner than the end of a one-year individual extension.

Taking Action for Employee Benefit Plan Administration

The Notice advises that plan administrators “should consider affirmatively sending a notice regarding the end of the relief period” to any participant at risk of losing benefits or rights under the plan due to the end of the relief period for that individual. Administrators and insurers should first consider identifying any plan participants facing previous plan deadlines (e.g., to enroll a new dependent, to elect COBRA) in March and April of 2020, since their one-year deadline extensions expire in March and April of this year.

The DOL also advises that any plan notices or disclosures already issued “may need to be reissued or amended if such disclosures failed to provide accurate information regarding the time in which participants and beneficiaries were required to take action,” and cites COBRA election notices and claim procedures notices as examples. Any prior communications (including SPDs, amendments and SMMs) regarding deadlines or extended deadlines should be reviewed in light of the Notice’s guidance and the individual one-year extension limit.

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