Earlier this month, the U.S. Department of Labor (DOL) and the U.S. Department of the Treasury extended several employer-sponsored health plan-related deadlines, including those related to the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) and the Health Insurance Portability and Accountability Act (HIPAA), based on the length of the COVID-19 national emergency.
The “Outbreak Period”
The deadline extensions are based on the “Outbreak Period,” which the federal government defines as the time that runs retroactively from March 1, 2020, until 60 days after the end of the President’s COVID-19 national emergency declaration, or until the DOL and the Treasury determine the end date. Because the national emergency is currently ongoing, the outbreak period continues to extend indefinitely.
COBRA Notifications and Enrollment
Ordinarily, health plan administrators must issue COBRA notices to health plan participants within 14 calendar days of the date of a qualifying event, such as the termination of employment. Now, this notice deadline is extended to the end of the currently ongoing outbreak period. This means that while the outbreak period continues, health plan administrators don’t have to issue COBRA notices within the 14-day deadline. However, once the outbreak period ends, health plan administrators have the 14-day deadline.
Health plan participants usually have 60 days to elect COBRA coverage from the date of the receipt of the COBRA notice. Currently, there is no deadline to elect COBRA coverage. For example, an employee who loses employment, or is otherwise disqualified from the health plan (e.g. reduction of hours below the minimum required), on March 30th doesn’t have a deadline to elect COBRA coverage. Once the outbreak period ends, then that employee will have 60 days to decide whether to elect COBRA coverage if they haven’t already done so.
HIPAA Enrollment Periods
Generally, employees may only elect coverage during open enrollment periods or during special events that occur outside the open enrollment period, such as marriage or the birth of child. When employees want to take advantage of the special enrollment periods, they must do so within 30 days of the qualifying event. Now, that period is extended to 30 days after the outbreak period conclusion.
Health Flexible Spending Accounts
Employee Retirement Income Security Act (ERISA) claim deadlines were also extended, including health flexible spending arrangements (FSAs). Many health FSAs have runout or grace periods that allow plan participants to file claims for some time after the plan year ended. For example, if a health FSA plan year ends on December 31, 2019, but has a runout period until March 30, 2020, a plan participant can still file 2019 claims until that runout period ends.
Now, under the extended deadlines, any health FSA plans that had a runout period that ended after March 1, 2020 must extend that deadline through the end of the outbreak period and cannot require forfeiture of any remaining funds due to untimely claims while this outbreak period continues.
This extension did not apply to the dependent care FSA plans.
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