By: HUB’s EB Compliance Team

The Departments of Labor (“DOL”) and Treasury/IRS have provided some relief for plan-related deadlines (see the DOL only guidance here and the joint regulations here). However, the additional flexibility for plan participants creates administrative burdens for employers. In this piece we’ll focus on the relief that exclusively applies to  employers and plan fiduciaries, while here we focus on the relief for plan participants under COBRA, HIPAA special enrollment rights, and the claims procedures as well as the implications (and some limited relief) for employers and plan fiduciaries.

Outbreak Period

The relief fundamentally provides a “pause” for counting the days for purposes of certain deadlines. The pause started on March 1, 2020 and goes until 60 days after the end of the Presidentially-declared national emergency or, if earlier, February 28, 2021 (the “Outbreak Period”).

 Other Notice Relief

Of welcome news to employers is that many notices to employees may also be delayed. Specifically, notices required by the Employee Retirement Income Security Act of 1974 (“ERISA”) that are required to be sent to employees and others during the Outbreak Period may be delayed. However, they must be provided as soon as they can. This applies to many of the standard notices and documents that employers provide, such as:

  • Summaries of Benefits and Coverage
  • ACA Notice of Marketplace Coverage Options
  • ACA Grandfathered Status Notice
  • ACA Patient Protection Disclosures
  • HIPAA/ACA Wellness Program Notices (but note EEOC Notice is not included)
  • HIPAA Special Enrollment Rights Notice
  • Children’s Health Insurance Premium Assistance Notice
  • Women’s’ Health and Cancer Rights Act Notice
  • Summary Plan Descriptions / Summaries of Material Modifications
  • COBRA Initial Notices
  • Summary Annual Reports

While this delay is helpful, employers should bear in mind that they still have an obligation to provide these notices as soon as they can. Employers may not be able to wait until the end of the Outbreak Period if they can provide the notices sooner.

To this point, the DOL does say that employers and other plan fiduciaries can use electronic means to communicate with plan participants and beneficiaries (including emails, text messages, and websites). However, the employer or other plan fiduciary must reasonably believe that participants and beneficiaries have effective access to electronic means of communication. This presents a challenge for employers who do not have email addresses or phone numbers for large sections of their workforce. Without a means to contact them, it seems it would be difficult to use an electronic means to provide these notices.

General Fiduciary Relief

Finally, the DOL guidance states that plan fiduciaries should otherwise be flexible with participants and beneficiaries to prevent loss or undue delay of benefits. Similar, the DOL recognizes that plans and service providers “may be unable to achieve full and timely compliance with claims processing and other ERISA requirements.” They DOL advises that it will take these issues into account in enforcing ERISA’s timelines and fiduciary requirements.

While this relief is helpful, it is vague and, as such, does not provide much comfort to plan fiduciaries. Compared to the strict bright line delays drawn for participants and beneficiaries described in our other article, employers and plan fiduciaries are encouraged to do their best to meet ERISA’s requirements and will be given some consideration from the DOL. This does not provide relief from the ability of claimants to go to court if the employer or plan administrator misses a deadline, so in practice, it will still be important for employers and plans to adhere as strictly close to the claims response deadlines and content requirements as possible.

Conclusion

While the relief for employers and plan fiduciaries is appreciated in light of the COVID-19 pandemic, they are limited in nature. Employers should understand that this relief does not relieve them of their responsibilities and they still must do their best to comply with the requirements and do so in a timely manner.

For the latest information on the COVID-19 crisis and its effect on employers, please keep visiting HUB’s Coronavirus Resource Center. If you have any questions, please contact your HUB Advisor. You can also view more compliance articles in our Compliance Directory.

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.