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COVID-19: May 2020 Update from ABG

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Category: COBRA, Compliance and Regulatory,


On May 4, 2020 Internal Revenue Service (“IRS”) and Employee Benefits Security Administration (“EBSA”) issued a final ruling regarding the extension of certain COBRA timeframes during the COVID-19 National Emergency in its “Extension of Certain Timeframes for Employee Benefit Plans, Participants, and Beneficiaries Affected by the COVID-19 Outbreak” notice. The intent of this ruling is to provide relief that is immediately needed to preserve and protect the benefits or participants and beneficiaries in all employee benefit plans across the Unites States during the National Emergency.

Under this ruling, the following timeframes are disregarded for the period of National Emergency (starting March 1, 2020) through 60 days following the end of the National Emergency Declaration (“Outbreak Period”), or until further rulings and guidance are issued.

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Relief for Plan Participants

  • The 30-day period (or 60-day period, if applicable) to request special enrollment under ERISA section 701(f) and Code section 9801(f), Start Printed Page 26354
  • The 60-day election period for COBRA continuation coverage under ERISA section 605 and Code section 4980B(f)(5),[9]
  • The date for making COBRA premium payments pursuant to ERISA section 602(2)(C) and (3) and Code section 4980B(f)(2)(B)(iii) and (C),[10]
  • The date for individuals to notify the plan of a qualifying event or determination of disability under ERISA section 606(a)(3) and Code section 4980B(f)(6)(C),
  • The date within which individuals may file a benefit claim under the plan's claims procedure pursuant to 29 CFR 2560.503-1,
  • The date within which claimants may file an appeal of an adverse benefit determination under the plan's claims procedure pursuant to 29 CFR 2560.503-1(h),
  • The date within which claimants may file a request for an external review after receipt of an adverse benefit determination or final internal adverse benefit determination pursuant to 29 CFR 2590.715-2719(d)(2)(i) and 26 CFR 54.9815-2719(d)(2)(i), and
  • The date within which a claimant may file information to perfect a request for external review upon a finding that the request was not complete pursuant to 29 CFR 2590.715-2719(d)(2)(ii) and 26 CFR 54.9815-2719(d)(2)(ii).

Relief for Group Health Plans

  • With respect to group health plans, and their sponsors and administrators, the Outbreak Period shall be disregarded when determining the date for providing a COBRA election notice under ERISA section 606(c) and Code section 4980B(f)(6)(D). 

Later Extensions

  • The Agencies will continue to monitor the effects of the Outbreak and may provide additional relief as warranted.

How is ABG handling this?

This is a very fluid situation and circumstances are evolving rapidly throughout the country. We will continue to make timely adjustments to the processes outlined below if and when it becomes necessary and as additional guidance becomes available.

  • Beginning Monday, May 11, 2020 all Specific Rights Notices, Late Payment Reminders, Partial Payment Notices and Termination Notices mailed to participants will include the below additional verbiage:

IMPORTANT NOTE REGARDING COVID-19

On May 4, 2020, the Internal Revenue Service (“IRS”) and Employee Benefits Security Administration (“EBSA”) issued a final ruling regarding the extension of certain timeframes during the COVID-19 Emergency. Your continuation coverage through the Consolidated Omnibus Reconciliation Act (COBRA) may be impacted by these extensions.

These extensions apply to many timeframes including (but not limited to) the 60-day election window and payment grace periods beginning March 1, 2020, through the end the Outbreak Period (which has yet to be determined). If you choose to defer payments, all premiums will still be required to be paid once the Outbreak Period ends.

Please read the ruling in full, available here: https://www.federalregister.gov/d/04-11796 

To read an FAQ for participants and beneficiaries, please visit: https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/covid-19.pdf 

  • A message will be posted to the Member Portal for any existing participants (the communication is linked here https://www.amben.com/demos/COBRA/ABG_COBRA_COVID-19_COVERAGE.pdf)
  • Late Payments will be automatically accepted. No additional action required.
  • Late Elections will continue to be processed. No additional action required.
  • Disability Extensions will be honored beyond the required timeline. No additional action required.
  • HIPAA Special Enrollments will be allowed beyond the required timeline. No additional action required.
  • All grace periods and election windows and current processes will continue to run as usual; however, late payments and elections will be accepted as outlined above. This includes:
    • Late Payment Reminders will be sent on or around the 13th of each month
    • Termination Notices will be sent if there is a failure to pay or request to cancel
    • Members will continue to be terminated from coverage as usual.

Additional Options:

  • If you wish to do a mailing of the Member Notification (https://www.amben.com/demos/COBRA/ABG_COBRA_COVID-19_COVERAGE.pdf) to your existing COBRA participants, ABG is able to do so. An additional fee of $3.75/notice would apply. Contact us if interested in this mailing
    • Mailing can be sent to active and/or pending COBRA participants
    • Mailing can be customized as you see fit
    • Mailing will be saved in Communications Tab of each Member’s account

We will continue to monitor any changes that may directly affect the ways in which we administer COBRA and will reach back out with any new information as it becomes available. We wish you all the best during these times and welcome you to reach out to us with any additional questions you may have.

Resources:

COBRA & Direct Billing
American Benefits Group

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