Update 1/5/18: The Department of Labor has announced that there will be no further delay in these rules. Employers that have not already taken the steps to address these rules should do so. Any plan providing benefits based on a determination of disability will need to include these rules and new employee communications will need to be prepared, if these steps have not already been taken. Additional resources are available here.
December 8, 2017
The Department of Labor finalized the 90-day extension of the effective date for the enhanced disability claims procedures. They now will become effective on April 1, 2018. The purpose of the delay is to evaluate data DOL has received and specifically data that suggests the final rule would increase the costs of disability plans. The DOL also wants to evaluate whether these new rules should be changed (or perhaps done away with) to address those costs. The DOL says that, if it does change or do away with these rules, it will provide the typical notice and comment period.
As a reminder, in late 2016, the DOL finalized changes to procedures for disability claims. The new disability claims procedures look very similar to (but are not exactly the same as) the enhanced claims procedures under the Affordable Care Act that apply to group health plans. The new disability claims procedures were set to go into effect on January 1, 2018 prior to this delay.
If employers have already amended their plans (or received amendments from carriers or other providers) for the new rules, they should first reach out to their carriers or other plan providers and ask if they planning to apply the extended effective date. Some carriers or other providers may have already changed their systems to comply with these new rules and therefore will not see a point in changing their processes at this point. If the delayed effective date will apply, then employers need to make sure to get any necessary plan amendments in place before January 1, 2018 and be prepared to communicate this change to participants.
HUB International will continue to monitor these developments and will provide additional updates as needed.
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NOTICE OF DISCLAIMER
The information herein is intended to be educational only and is based on information that is generally available. HUB International makes no representation or warranty as to its accuracy and is not obligated to update the information should it change in the future. The information is not intended to be legal or tax advice. Consult your attorney and/or professional advisor as to your organization’s specific circumstances and legal, tax or other requirements.