Extended Timeframes for Plan Disclosures and Elections, Including COBRA and HIPAA

Most employer-sponsored health and welfare plans, participants and employees have extended timeframes, deadlines and added flexibility to comply with certain notice, disclosure and election requirements. These extensions and flexibility are provided under ‘COVID-19 relief guidance’, which comes in three parts: EBSA Disaster Relief Notice 2020-01; DOL / IRS notification of relief; and COVID-19 FAQs for Participants and Beneficiaries.

Relief for Employee and Participant Actions

The following group health plan timeframes and deadlines for certain employee and participant actions / elections are extended by the duration of the “outbreak period”, defined as the time period effective as of March 1, 2020, and until 60 days after the end of the COVID-19 National Emergency (which, as of the date of the summary, has yet to be announced) or such other date announced by the DOL:  

  • The 30-day (or 60-day) period to make a HIPAA special enrollment right election;
  • The various timeframes and deadlines for participants and qualified beneficiaries to elect COBRA coverage, to pay COBRA premiums, and to notify the plan of specific COBRA qualifying events like divorce, death or disability; and
  • The timeframes and deadlines for participants to file or perfect benefit claims or appeals of denied claims.

For example, assume covered employee experiences a COBRA qualifying event and is provided a COBRA election notice on April 1, 2020. To determine the deadline for the employee (and other covered dependents) to elect COBRA, the “outbreak period” is disregarded. If we assume the National Emergency ends on June 30, 2020, with the “outbreak period” ending 60 days later on August 29, 2020, then the last day of the COBRA election period is 60 days after August 29, 2020, which is October 28, 2020. Furthermore, if the employee elects COBRA and makes required premium payments (the premium payment deadlines are similarly extended by the outbreak period), COBRA will be retroactive to April 1.

Relief for Employers to Distribute Notices and Disclosures

For the duration of the “outbreak period”, employers have extra time to provide ERISA-required notices and disclosures (including SPDs, SMMs, COBRA notices, etc.). This relief applies to all ERISA-required notices and disclosures except those addressed in the DOL / IRS notification for relief which have special timeframes (for example, the COBRA election notice as described above). In addition, employers may utilize electronic alternative disclosure methods (e.g., email, text messaging, continuous access websites); even if those methods are not otherwise permitted under current rules. Nevertheless, during the outbreak period, employers must act in good faith and provide notices and disclosures as soon as administratively practicable under the circumstances.

Employer Action Items

Numerous administrative challenges, financial concerns and questions exist, many spurred by the open-endedness of the COVID-19 National Emergency end date (and thus the applicable “outbreak period”). Employers should consider how to effectively communicate extended timelines and deadlines to their employees. Clear communications are more important than ever. Employers should also confirm third party administrator and insurer practices, including stop-loss coverage, are in alignment with the requirements of the COVID-19 relief guidance.

If you have any questions, please reach out to your Mercer consultant. A forthcoming Mercer GRIST will provide an in-depth analysis of this COVID-19 relief guidance for health and welfare plans. See this GRIST for details on the application of this relief to retirement plans.

Carol Malenka
by Carol Malenka

Principal, Mercer

Principal, Mercer Health

Sheryl Stime
by Sheryl Stime

Principal, Mercer

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