COVID-19 National Emergency 2023 Final Update
Updated May 1, 2023
Issue Date: April 2023
COVID-19 National Emergency Update
On October 6, 2021 the IRS released new guidance, IRS Notice 2021-58, that further explained the application of extensions for the election of COBRA and payment of COBRA as set forth on May 4, 2020 in response to the COVID-19 National Emergency.
The guidance clarified that the disregarded period for a participant to elect COBRA continuation coverage and the disregarded period for the participant to make initial and subsequent COBRA premium payments generally run concurrently. Participants have until (1) up to one year and 60 days after the participant’s receipt of the COBRA election notice or (2) 60 days after the end of the Outbreak Period , whichever is earlier, to make the COBRA election and initial payment.
On February 10, 2023, Joe Biden announced that he plans to end the COVID-19 National Emergency on May 11, 2023.
The Departments of Labor (DOL), Health and Human Services, and the Treasury issued guidance on March 29, 2023, providing awareness and clarity to changes that will accompany the end of the National Emergency and how those changes will impact the COBRA grace period extensions and the outbreak period.
Recently the US Senate passed a bill that, if signed by Biden, will end the National Emergency immediately.
Extensions and the Outbreak Period
The March 29, 2023 guidance clarifies that with the anticipated end of the National Emergency on May 11, 2023, the Outbreak Period will end July 10, 2023 (60-days after the anticipated end of the National Emergency). The extensions under the emergency relief for timeframes that began during the National Emergency no longer apply. As clarified in 2021, the disregarded period was permitted to a period of 1 year from the first date of eligibility for the relief or the announced end of the outbreak period, whichever occurred first.
Further clarification in the March 29, 2023 guidance states that individuals, in some circumstances, will still be permitted a minimum timeframe to complete elections, initial payments, and subsequent payments. See examples below, assuming the National Emergency end date is May 11, 2023.
COBRA Election Outbreak Period:
- COBRA SRN Date: 5/1/2023
- “Normal” time period for making election: 60 days
- Outbreak End (7/10/2023) + 60 days =9/8/2023
COBRA Election Outbreak Period, After the end of the National Emergency:
- COBRA SRN Date: 5/12/2023
- “Normal” time period for making election: 60 days
- Outbreak End (7/10/2023) + 60 days = 9/8/2023
COBRA Election – 1 year
- COBRA SRN Date: 5/30/2022
- “Normal” Elect by Date (60 days): 7/29/2022
- 7/29/2022 + 365 days =7/29/2023
Initial Payment Outbreak Period:
- COBRA SRN Date: 10/01/2022
- Participant Elected: 10/15/2022
- “Normal” time period for making the initial payment: 45 days
- Outbreak End (7/10/2023) + 45 days = 8/24/2023
Subsequent Payment Outbreak Period:
- First Day of Coverage: 7/01/2022
- Participant Paid Thru 9/30/2022, takes the extension
- Premium Month Owed: 10/1/2022
- “Normal” time period for making subsequent payments: 30 days
- Outbreak End (7/10/2023) + 30 days = 8/09/2023
- Required Premiums: October 2022 – July 2023
What does this mean to our clients?
Business As Usual
Since our organization did not use any auto-extension functionality in our COBRA system, we will continue to operate as normal. Participants will continue to submit appeals for late payments that are reviewed by our compliance team; moving forward however, they will not automatically be approved due to the Federal payment extensions.
COVID-19 National Emergency – Status
Updated March 1, 2023
Issue Date: February 2023
COVID-19 National Emergency Update
On February 10th, President Biden announced that he plans to end the two COVID-19 national emergencies on May 11, 2023. While this is the Administration’s current plan, it is subject to change and the Administration has not released further details about ending the national emergencies.
AccrueCMS has been preparing for the end of the national emergencies and will continue to monitor and communicate any new information released. While we await an update, we’re including some information that might be beneficial in planning for the official end to the declaration.
The end of the COVID-19 national emergency will end the extensions first announced in EBSA Disaster Relief Notice 2020-01, which provided qualified beneficiaries and COBRA members with more time to send certain notifications about COBRA coverage, to elect COBRA, and to make premium payments. The temporary extensions were retroactive to any deadline occurring March 1, 2020 until 60 days after the COVID-19 national emergency is declared over or until one year has passed, whichever occurred first.
FSAs and HRAs
EBSA Disaster Relief Notice 2020-01 also granted a temporary extension to run-out periods for flexible spending accounts (FSAs) and health reimbursement arrangements (HRAs). The extension gives participants additional time to submit claims for any active plan year they are enrolled in that has a run-out period ending between March 1, 2020 and 60 days after the COVID-19 national emergency is declared over , whichever occurred first.
Biden Administration Extends National Emergency for Another Year
Updated March, 2022
Issue Date: February 2022
On February 18, 2022, President Biden formally extended the COVID-19 National Emergency for up to another year. The National Emergency first went into effect on March 1, 2020, and after being first extended in February 2021, was set to expire on March 1, 2022.
After a National Emergency was declared as of March 1, 2020, regulatory agencies jointly issued a final rule in April extending several specific notice and disclosure deadlines applicable under HIPAA, COBRA, and ERISA. The rule effectively extended the time participants were given for things like COBRA elections, COBRA payments, HIPAA special enrollments, and ERISA claims filing and appeals. In addition to the final rule, the DOL issued Disaster Relief Notice 2020-01, granting some leniency regarding enforcement of the timing and delivery method for plan sponsor disclosures required under ERISA. The rules apply broadly to all employer-sponsored benefits subject to ERISA and COBRA. The Department of Health & Human Services (HHS) indicated that similar relief was available to non-federal governmental plans as well.
For the period of time beginning March 1, 2020, until 60 days after the National Emergency is over (the “Outbreak Period”), all group health plans, disability plans, other employee welfare benefit plans, and employee pension plans must disregard this time period when administering plans with respect to notices, disclosures and other deadlines covered by the rule.
This most recent extension of the National Emergency further extends the duration of the Outbreak Period. It is possible that President Biden will end the National Emergency before another year passes, but this remains to be seen. Plan sponsors should be aware that the extended deadlines for participants under HIPAA, COBRA, and ERISA remain in effect for the time being and ensure that their plans continue to operate in accordance with the requirements for any deadlines.
EBSA Disaster Relief Notice Update 2021-01
Updated March 10, 2021
EBSA Disaster Relief Notice 2020-01
COBRA Deadline Extensions
Updated May 12, 2020
On April 28, 2020, the U.S. Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) issued guidance providing significant deadline extensions and other relief to assist employee benefit plans, plan participants and beneficiaries, employers and other plan sponsors, plan fiduciaries, and other service providers impacted by the COVID-19 outbreak. The guidance applies to health and welfare plans and retirement plans and follows the March 13, 2020 declaration of a federal emergency resulting from the COVID-19 pandemic.
The CARES Act (COVID-3 Stimulus Bill)
Updated March 31, 2020
The “Coronavirus Aid, Relief, and Economic Security Act” or the “CARES Act” was signed into law on March 27, 2020. What exactly does this mean? This new bill contains many employee benefit-related items. The revisions permanently reinstate coverage of over-the-counter (OTC) drugs and medicines as eligible for reimbursement from FSAs, HRAs, and HSAs without the necessity of a prescription, assuming the employer’s plan documents allow so. It further expands the definition of qualified OTC items to include eligible menstrual care products that can be purchased with these funds. This change is effective for expenses incurred on or after January 1, 2020.
As the industry makes this important transition, the implementation of the new eligible item list will gradually occur over the next 4-6 weeks.
Have questions or interested in learning more about HSAs, FSAs and other common benefits? Visit our Contact page now.