Agencies Extend Important Health and Welfare and Retirement Plan Deadlines

By Anne Tyler Hall and Robert Forman, Hall Benefits Law

On April 28th, the Department of Labor’s (“DOL”) Employee Benefits Security Administration (“EBSA”) and the Department of Treasury and Internal Revenue Service issued a joint rule (the “Rule”) and notice (EBSA Notice 2020-01 or the “Notice”) announcing relief from certain pre-established deadlines for group health plans, other welfare benefit plans, and retirement plans. For group health plans subject to ERISA and the Internal Revenue Code, the relief provides additional time to comply with certain deadlines affecting COBRA continuation coverage, special enrollment periods, benefits claims, appeals of denied claims, and external review of certain claims. For disability, retirement and other benefit plans, the Rule provides additional time for participants and beneficiaries to make claims for benefits and appeal denied claims. The purported aim of the deadline extension is to prevent benefit plan participants from missing key deadlines during the Coronavirus pandemic that could result in the loss or lapse of group health coverage or the denial of a valid benefits claim. The extension applies to notices due commencing on March 1, 2020, and ending on the date that is 60 days after the end of the COVID-19 National Emergency (the “Coronavirus Delay Period”).

To Whom Does the Extension Apply and What is the Timeframe for the Deadline Extension?

The deadline extension provided for in the Rule and Notice applies to employee benefit plans, employers, labor organizations, and other plan sponsors, plan fiduciaries, participants and beneficiaries and service providers subject to ERISA. The DOL acknowledged that there will be different Coronavirus outbreak period end dates for different areas of the country. Accordingly, the DOL will issue additional guidance regarding the application of the relief to those different areas.

Which Deadlines Are Impacted by the Rule?

Generally, the deadline extension applies to the furnishing of notices, disclosures, and other documents required by the provisions of Title I of ERISA. The Rule and Notice provides that benefit plans subject to ERISA or the Code (including group health plans, disability and other employee welfare benefit plans and employee pension benefit plans) must disregard the Coronavirus Delay Period for all plan participants, beneficiaries, qualified beneficiaries, or claimants in determining the following periods and dates:

  • Special Enrollment Period. The Rule and Notice requires a delay of the standard 30-day period (or 60-day period, if applicable) for an eligible individual to request special enrollment to a group health plan or other health insurance coverage. The 30-day special enrollment rights are generally triggered upon an eligible employee or dependent’s loss of other health coverage in which they were previously enrolled and upon certain life events (birth, marriage, adoption, or placement for adoption). The sixty-day special enrollment period is generally triggered by changes in eligibility for state premium assistance under the Children’s Health Insurance Program (CHIP).
  • COBRA Election Period and Payments. The Rule and Notice require a tolling of the following COBRA deadlines:
    • The 14-day deadline for plan administrators to furnish COBRA election notices;
    • The 30 or 60-day deadline for an employer or individuals to notify the plan of a qualifying event;
    • The 60-day deadline for participants to elect COBRA;
    • The 45-day deadline for making the initial premium COBRA payment and the 30-day deadline for subsequent COBRA premium payments; and
    • The 60-day deadline for individuals to notify the plan of a determination of disability.
  • Claims Procedures. The Rule and Notice extend benefit claims deadlines for individuals filing for a claim for benefits, the plan administrator’s initial adverse benefit determination, and the appeal of an adverse benefit determination (for ERISA and non-grandfathered group health plans). Group health plans and disability plans generally must allow at least 180 days in which to appeal. Other welfare plans must allow 60 days in which to appeal.
  • External Review Process. Under the Rule and Notice, non-grandfathered group health plan deadlines have been extended for providing a state or federal external review process following exhaustion of the plan’s internal appeals procedures. State external review deadlines vary. For plans utilizing the Federal external review process, the process must allow at least four months after the receipt of a notice of an adverse benefit determination or final internal adverse benefit determination for a request for an external review to be filed. Other deadlines, including the opportunity to perfect an external review request (i.e., the four-month filing period or within the 48-hour period following the receipt of the notification, whichever is later) are also extended.
Is Any Other Relief Available Under the Notice?

The Rule and Notice confirms that Form 5500 filing relief, as provided by IRS Notice 2020-23, is available for plan filings otherwise due on or after April 1 and before July 15. Such filing deadlines are now extended to July 15. The Notice provides this same relief for Form M-1 filings for multiple employer welfare arrangements. The general deadline for annual Form M-1 filings is March 1 (with a 60-day extension available upon timely request). The Rule and Notice also contemplates relief for the 30-day advance notice generally required for retirement plan blackout periods. The Rule and Notice also provide relief with respect to the normal deadline for the deposit into retirement plans of amounts withheld by an employer from employee payroll.  The pre-relief deadline for such deposits had been the date no later than the 15th business day of the month following the month in which such amounts were withheld by the employer from employee payroll.

What are Employer Requirements Related to Notice Relief?

Pursuant to the Rule and Notice, if the plan and responsible fiduciary act in good faith to furnish ERISA or Code-required notices, disclosures or documents as soon as administratively practicable under the circumstances, such plan and responsible fiduciary will not be in violation of ERISA to timely furnish such documentation. Good faith efforts include the use of electronic methods of communication with plan participants and beneficiaries who the plan fiduciary reasonably believes have effective access to electronic methods of communication, including email, text messages, and access to websites.

We are available and well-equipped to help with all manner of ERISA and employee benefits legal compliance questions. If you need assistance navigating the impacts of COVID-19 to employee benefits plan legal compliance, we have a multitude of resources available on our website, www.hallbenefitslaw.com. Sign up to keep track of upcoming webinars for even more detailed information about the impact of the novel coronavirus on employers’ responsibilities relative to benefits plans:

https://hallbenefitslaw.com/contact-us/

If you have questions regarding your Form 5500 deadline, or if you need assistance filing your Form 5500, contact David Hall today at 470-571-1007.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.

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