Guidance on Extended Deadlines for Group Health Plans

The guidance extends the previous time extensions on a case-by-case basis based on each individual’s (or the plan’s) original deadline.

In addition, the DOL recommends plan administrators provide additional notices to participants regarding the end of their deadline. Notices that were previously sent, including those provided with COBRA election forms, may need to be revised.

Background

Under previous guidance issued in 2020, the DOL had announced that for purposes of determining certain deadlines, group health and disability plans must disregard the “Outbreak Period,” which began March 1, 2020 and will end 60 days after the end of the ongoing National Emergency related to COVID-19.

By law, the DOL is expressly limited to permitting a one-year extension, but how that year would be calculated was generating questions, particularly since one year from the first date this relief became available (March 1, 2020) was February 28, 2021.

New guidance

The new guidance, Disaster Relief Notice 2021-01, clarifies that the duration of these deadline extensions will have to be determined on a case-by-case basis, based on each individual’s (or the plan’s) original deadline. However, under no circumstances is extension required to last longer than one year.

Specifically, an individual’s actual deadline (such as their COBRA election deadline or the deadline to request special enrollment) will be the earlier of:

• One year from the date the individual was first eligible for relief (i.e., one year from their original deadline (which could be no earlier than March 1, 2020)
• 60 days after the announced end of the National Emergency (i.e., the end of the Outbreak Period).

Similarly, if a plan is required to send a notice or disclosure by March 1, 2020, the relief would end with respect to that notice or disclosure on February 28, 2021, and the plan would be required to ensure the notice or disclosure was provided on or before March 1, 2021.

Fiduciary duty to notify participants

The DOL advises plan fiduciaries to make reasonable accommodations to prevent the loss of or undue delay in payment of benefits. In addition, the DOL states that plan fiduciaries should take steps to minimize the possibility of individuals losing benefits because of a failure to comply with pre-established time frames.

To protect participants, the DOL encourages plan sponsors to send notices to participants regarding the end of their relief period. 

In addition, DOL states that notices that were sent previously may need to be reissued or amended if they failed to provide accurate information about when individuals were required to take action. 

Good-faith efforts

The DOL acknowledges that, due to the pandemic, plans and service providers may continue to have problems meeting claims processing or disclosure deadlines. For fiduciaries acting in good faith and with reasonable diligence, the DOL’s enforcement approach will emphasize compliance assistance and include grace periods and other relief.

Other departments concur with the guidance

The Departments of Treasury, IRS and Health and Human Services reviewed the DOL notice. They have advised DOL that they concur with the guidance and will apply it in the enforcement of laws under their jurisdiction.

Plan sponsor actions

Plan administrators should determine what type of notices or other announcements they need to send out, including whether a general notice would suffice or if more individualized communications are needed. It makes sense to focus initially on individuals whose new deadlines are imminent.

Notices that were sent previously (such as inserts with COBRA election notices) should be reviewed and revised as necessary for use going forward.