Year-end Deadlines & Considerations, Part 2 (COBRA)

December 13, 2021

COVID-19 COBRA Extensions Expiring

As a result of the pandemic, the Department of Labor extended a number of deadlines for health and welfare plans. These extensions apply to participant claims and appeals deadlines, participant health plan special enrollment rights, and participant obligations under COBRA. Per applicable law, these deadlines could be extended for only up to one year.

Pursuant to the DOL and IRS Joint Notice, Notice 2020-01, and FAQs, ERISA health and welfare plans must extend various deadlines during the “outbreak period” including the:

  • 60-day deadline for an individual to elect COBRA coverage
  • 45-day deadline for an individual to make an initial COBRA premium payment
  • 30-day deadline for an individual to make a subsequent monthly COBRA premium payment
  • 60-day deadline for an individual to notify the plan of certain COBRA qualifying events (i.e., divorce or a dependent child ceasing to be a dependent child)
  • deadline for a COBRA qualified beneficiary to notify the plan of a determination of disability
  • 14-day deadline for plan administrators to provide COBRA election notices to qualified beneficiaries
  • 30-day special enrollment period for individuals who lose health coverage
  • 30-day special enrollment period for individuals who gain new dependents
  • 60-day special enrollment period for individuals who lose or gain eligibility for Medicaid or children’s health insurance program
  • deadline for an individual to file a benefit claim under ERISA’s claim procedures
  • deadline for an individual to appeal an adverse determination under ERISA’s appeal procedures
  • 4-month deadline for an individual to request an external review after receipt of an adverse benefit determination or final internal adverse benefit determination
  • 4-month deadline (or, if later, 48 hours following receipt of notice of an incomplete request) for an individual to file information to perfect a request for external review of a benefit determination upon learning the request was incomplete.

In EBSA Disaster Relief Notice 2021-01, the DOL subsequently clarified that for purposes of calculating the extended deadlines, plans must disregard the “outbreak period” until the earlier of:

  • one year from the date an individual is first eligible for relief, or
  • 60 days after the announced end of the COVID-19 National Emergency.

This leads to individual one-year extensions of the deadlines referenced above while the COVID-19 National Emergency is ongoing. 

Furthermore, in IRS Notice 2021-58, the IRS clarified the extended deadline to elect COBRA and the extended deadline to make COBRA premium payments generally run concurrently. 

Plan sponsors should be mindful of whether deadlines are still tolled and should be prepared for the end of the deadline extension. Employers who have not yet amended their plans to reflect the deadline extensions for notices, elections, and certain other specific actions relating to COBRA and claims and appeals may consider setting forth how (and for how long) those extensions will apply.

COBRA Requirements Under ARPA

Although the ARPA COBRA subsidy period expired as of September 30, 2021, employers should consider whether they complied with ARPA and whether they timely issued the applicable notices. In addition, employers should consider whether they accounted for and claimed applicable premium subsidy credits for COBRA coverage provided pursuant to ARPA.

ARPA provided:

  • a subsidy for certain COBRA premiums,
  • an opportunity for certain individuals to enroll or re-enroll in COBRA continuation coverage, and
  • an option to elect less expensive health coverage. 

ARPA also imposed several significant notice requirements that relate to COBRA rights. In particular, employers should consider whether their ARPA expiration notices explained the ability for individuals to enroll in individual market coverage when their COBRA premium subsidies ended. Health & Human Services adopted regulations on April 30, 2021 to provide COBRA recipients with a special enrollment period for individual market coverage due to the end of employer contributions or government subsidies. The DOL’s model notices reflect this policy. 

See the additional article in this publication for extension deadlines that apply to cafeteria plans, telehealth, and pricing transparency.

For more information on specific details related to these changes in welfare benefits and when the different relief periods end or require action, please refer to previous Chard Snyder Compliance communications or contact your Chard Snyder Client Relationship Manager for more assistance.