The U.S. Department of Labor (DOL)’s Employee Benefits Security Administration (EBSA) has issued EBSA Disaster Relief Notice 2021-01, which provides guidance on continuation of relief for employee benefit plans and plan participants and beneficiaries due to the COVID-19 (coronavirus) outbreak. This “outbreak period,” which began on March 1, 2020, will end 60 days after the national emergency ends unless the agencies announce a different date. When measuring due dates, the time covered by the outbreak period doesn’t count.
As we previously reported, the EBSA and the Internal Revenue Service (IRS) issued a joint rule on May 4, 2020, requiring all group health plans, disability plans, other employee welfare benefit plans, and employee pension benefit plans subject to the Employee Retirement Income Security Act (ERISA) or the federal tax code to extend certain deadlines for plan participants and beneficiaries during the COVID-19 pandemic. By statute, the maximum length of such an extension is one year. As the March 1 anniversary of the beginning of the national emergency approached, the EBSA began fielding questions about how to apply these extensions. The new guidance states that the usual timeframes that would normally require a plan sponsor or individual to take a particular action will be disregarded until the earlier of (a) one year from the date they were first eligible for relief, or (b) the end of the outbreak period, i.e., 60 days after the announced end of the national emergency. Importantly, on the applicable date, the timeframes for individuals and plans with periods that were previously disregarded will resume. The EBSA also provided three examples:
If a qualified beneficiary who lost coverage under an employer-sponsored group health plan would have been required to make a COBRA election by March 1, 2020, in order to continue coverage by self-paying, the joint rule delays the election requirement until February 28, 2021, which is the earlier of one year from March 1, 2020, or the end of the outbreak period (which remains ongoing).
If a qualified beneficiary would have been required to make a COBRA election by March 1, 2021, the joint rule delays that election requirement until the earlier of one year from that date (March 1, 2022) or the end of the outbreak period.
If a plan would have been required to furnish a notice of disclosure by March 1, 2020, the relief under the joint rule would have ended with respect to that notice or disclosure on February 28, 2021. The responsible plan fiduciary would be required to ensure the notice or disclosure had been furnished on or before March 1, 2021.
Tips: Continue to work with your third-party benefits administrator or other benefits adviser to ensure that your group health plan participants and beneficiaries are notified of any deadline extensions that apply to them. You may also want to ensure whoever issues your COBRA notices is aware of the model notices explaining the extension. Note: As reported separately in today’s newsletter, the DOL will be updating the model notices again to incorporate a temporary six-month subsidy of COBRA premiums, available from April 1, 2021, through September 30, 2021. For information on what events trigger the obligation to send a COBRA notice, see our Legal Guide, COBRA Qualifying Events and Notice Schedule.