Regulatory Resources
Background
Due to the coronavirus (COVID-19) pandemic, in 2020, federal agencies temporarily extended certain timeframes under group health benefit plans, including dental plans, disability and other plans subject to ERISA and the Internal Revenue Code, including HRAs and FSAs.
The U.S. Department of Labor (DOL) and the IRS issued a notification of relief (Notification) that affects a number of timeframes, including those related to special enrollee elections, COBRA coverage, filing claims and appeals.
The COVID-19 outbreak in the United States was declared a National Emergency in 2020 by the President, beginning March 1, 2020. President Biden has extended the declaration of a National Emergency.
The federal relief notification issued in 2020 extended certain timeframes by mandating the period starting March 1 2020(1) through 60 days after the National Emergency is over (known as the “Outbreak Period”) to not be considered in applying certain timeframes; however, the extension cannot exceed one year. The date for the end of the National Emergency has not yet been announced.
New Guidance on COBRA Extensions of Time
The IRS issued Notice 2021-58 on October 6, 2021, which clarifies the application of certain extensions for the election of COBRA coverage and payment of COBRA premiums. Specifically, the disregarded period for an individual to elect COBRA and the disregarded period for an individual to make initial and subsequent COBRA premium payments generally run concurrently.
- If an individual elected COBRA continuation coverage outside of the initial 60-day COBRA election timeframe, that individual generally will have 1 year and 105 days (60 days to make initial election + 45 days to make initial premium payment) after the date the COBRA notice was provided to make the initial COBRA premium payment.
- If an individual elected COBRA continuation coverage within the initial 60-day COBRA election timeframe, that individual will have 1 year and 45 days after the date of the COBRA election to make the initial COBRA premium payment.
Because some individuals may have assumed that the disregarded period for making the initial premium payment begins on the date of the COBRA election, individuals who made elections outside of the initial 60-day COBRA election timeframe may have less time than anticipated to make the initial premium payment. To avoid inequitable outcomes, IRS Notice 2021-58 states that in no event will an individual be required to make the initial premium payment before November 1, 2021, even if that date is more than 1 year and 105 days after the date the election notice was received, provided that the individual makes the initial premium payment within 1 year and 45 days after the date of the election.
EBSA Disaster Relief Notice 2021-01
The federal Employee Benefits Security Administration (EBSA) issued EBSA Disaster Relief Notice 2021-01 on February 26, 2021. Notice 2021-01 indicates that individuals and plans with timeframes that are subject to the relief under the previously issued Notification will have the applicable timeframes disregarded until the earlier of:
- (a) 1 year from the date they were first eligible for relief,(2) or
- (b) 60 days after the announced end of the National Emergency (the end of the Outbreak Period).
On the applicable date, the timeframes for individuals and plans with timeframes that were previously disregarded under the Notification will resume. In no case will a disregarded period exceed 1 year.
The table below outlines the deadlines that have been temporarily extended and what actions are required by employers or Luminare Health as a result.
NOTE: These extended timeframes are required for all ERISA groups. Non-ERISA groups are not required to comply, but the federal government recommends that groups follow these extensions. The date of the end of the national emergency could vary for different parts of the country, if public emergencies end at different times in different states or regions.
Non-ERISA groups who do not wish to comply need to notify their Luminare Health client manager. We will administer non-ERISA plans consistent with these temporarily extended deadlines unless otherwise notified.
| Which Time Frames are Impacted by the Federal Extension? | What’s the Time Frame? | Extend the Time Frame by Disregarding the Earlier of: |
|---|---|---|
| Time Frame for Special Enrollee to Elect Coverage* | 30 days from the qualifying event (i.e. birth, marriage, adoption) | 1 year from the date they were first eligible for relief; or 60 days after the announced end of the National Emergency |
| Time Frame for Plan to Provide COBRA Election Notice**to Employee/Dependent | 14 days from the date the plan administrator is notified of a qualifying event. | |
| Time Frame to Elect COBRA** | 60 days from the later of: a. the date the election notice is furnished; or b. the date coverage ends |
|
| Time frame to Remit Initial COBRA Premium** | 45 days from the COBRA election date | |
| Time Frame to Remit Subsequent COBRA Premium** | Within the 30-day grace period after the first day of the coverage period | |
| Time Frame to Provide Notice of Qualifying Event | 60 days from qualifying event (i.e. divorce, loss of dependent child status, disability) | |
| Time Frame to Submit a Claim | Deadline to file a claim under the plan (time frame may vary from plan to plan but is often 12 months) | |
| Time Frame to Submit a Request for Internal Appeal | 180 days from receipt of notice of adverse benefit determination | |
| Time Frame to Submit a Request for External Appeal* | 4 months from receipt of final adverse benefit determination | |
| Time Frame to Perfect a Request for External Appeal* | The later of: a. The end of the 4-month period in which to request an external appeal; or b. 48 hours from receipt of notification that explains the request for external review is incomplete and describes the information or materials needed to make the request complete. |
*Does not apply to limited scope dental or disability income plans.
**COBRA is applicable only for members/dependents of groups with 20 or more employees in the prior year. COBRA does not apply to disability income plans. Pursuant to IRS Notice 2021-58, the disregarded period to elect COBRA and the disregarded period to make COBRA premium payments run concurrently.
1 On March 13, 2020, the President issued the Proclamation on Declaring a National Emergency Concerning the Novel Coronavirus Disease (COVID–19) Outbreak and by separate letter made a determination, under section 501(b) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. § 5121 et seq., that a National Emergency exists nationwide beginning March 1, 2020, as the result of the COVID–19 outbreak (the National Emergency). See 85 FR 26351, 52 (May 4, 2020).
2 Section 9501(b)(1)(D) of the ARP requires premium payees (as described in Notice 2021-31) to reimburse Assistance Eligible Individuals for premium amounts that those individuals would have been required to pay if not for the COBRA premium assistance available under the ARP.
3 The first date upon which an individual or plan could be eligible for relief was March 1, 2020, the first day of the National Emergency. Therefore, the earliest date upon which a disregarded period can begin to run again is March 1, 2021, including for periods during which an action is required or permitted to be completed that began before March 1, 2020.