Getting Back to Business After the End of the National Emergency
August 24, 2023
It has now been over three years since the National Emergency was announced in March 2020. As a result, there was a flood of relief directed at employee benefit plans. This included guidance issued by the Department of Labor (DOL) and Internal Revenue Service (IRS) to extend certain plan deadlines. The National Emergency continued for such a significant length of time, that returning to the normal administration of benefits, now that it has ended, may be difficult for those who have grown accustomed to extended deadline dates.
Specifically, certain deadlines were tolled or suspended during what has been termed the “Outbreak Period” which ran from March 1, 2020 to July 10, 2023 (i.e., 60 days the end of the National Emergency). Most of the delayed deadlines benefited participants and gave them additional time to complete required actions, but plan administrators were permitted an extension of time to provide qualified beneficiaries with the COBRA Election Notice. The normal deadline to provide this notice is no later than 44 days after the qualifying event (when the employer is also acting as the plan administrator). The extension meant that for qualifying events that occurred prior to July 11, 2023, the plan received an extension of time to provide the notice of up to one year or the length of the Outbreak Period, whichever was shorter. For qualifying events occurring on July 11, 2023 or after, the normal 44-day deadline will apply.
The good news is that many plans have likely adjusted to business as usual in respect to delivering COBRA Election Notices and may have only taken advantage of the extended deadlines in the early days of the pandemic, if at all. Nevertheless, this reset is a good opportunity for an evaluation of delivery timing and operations to make sure there are no risks of noncompliance and no systemic failures regarding notice delivery.
The most significant aspect of the Outbreak Period deadline extensions were the allowances that were given to individuals. People who experienced HIPAA events, wanted to submit or appeal claims, or had to meet COBRA deadlines had the benefit of significant extensions of potentially up to one year, which allowed them to potentially take advantage of opportunities that are generally not available.
For example, if someone failed to elect COBRA within their 60-day window and three months later had a significant medical event, they would be responsible for their own costs because COBRA would be unavailable to them. However, thanks to the deadline extensions, someone who had an incident many months after their loss of health coverage would have been able to elect COBRA to have insurance to cover those costs. This gave individuals significant latitude to make COBRA elections and may have meant that plans have been falling victim to adverse selection during the Outbreak Period. Given these issues, the return to normal for plan deadlines may be welcome relief to employers.
The various deadlines that were delayed for individuals were the following:
- HIPAA special enrollment periods
- Election period for COBRA continuation coverage
- Date for making COBRA continuation coverage premium payments
- Date to notify a health plan of a qualifying event or determination of disability
- Date to make a claim for benefits under the plan's claims procedures
- Date to perfect an incomplete claim
- Dates to appeal denied benefits and for external review of claims denials
There is no requirement to notify individuals that these important deadlines will begin running after the end of the Outbreak Period, but the DOL has recommended that efforts be made to inform individuals of the changes. Ensuring this type of information is communicated to all impacted persons may be a significant undertaking, and employers should seek advice on how to best ensure that any communications are delivered in a uniform and consistent manner.
We have made tools available including alerts on the participant claims portal and communications to COBRA beneficiaries.