By: HUB’s EB Compliance Team

Since January 27, 2020 the United States has been in a state of Public Health Emergency (“PHE”) in response to the COVID-19 pandemic. In addition, since March 13, 2020, the United States has been in under a declared Presidential National Disaster Declaration (the “National Emergency”) that has been renewed multiple times. The latest indication from the President is that the PHE and National Emergency will both come to an end on May 11, 2023. The end of the PHE and National Emergency will bring about changes for employer sponsored health plans, however not all pandemic related changes will immediately come to an end.

Ending the PHE Means an End to First Dollar Coverage of Tests and Most Vaccines

Under current law, during the PHE employer sponsored health plans are required to cover a number of items related to, and in response to the pandemic. These are covering COVID-19 tests and vaccines without cost sharing. The testing requirement applies to both in-network tests and out-of-network tests (at the posted rate) ordered by medical professionals, as well as over the counter tests. Also included is the requirement that plans cover COVID-19 vaccines at 100% including both initial and supplemental booster shots, whether in- or out-of-network.

Each of these required items will be rolled back with the end of the PHE, except for the requirement to cover COVID-19 vaccines in-network for non-grandfathered plans. The requirement to cover COVID-19 vaccines on an in-network basis for non-grandfathered plans will continue indefinitely. Plans may however continue to cover the remaining items without cost sharing if they choose. Fully-insured plans will be limited to what the insurance carrier chooses to continue to include or roll back with their plans. Self-insured plans will have more flexibility; however their Third-Party Administrators may have recommended or default approaches for plans which they administer.

Ending the National Emergency Means an End to The Outbreak Period

In contrast to the PHE, the National Emergency was first declared by then President Trump in March of 2020 and has been extended twice. While the PHE triggers certain coverage requirements, the National Emergency extends a number of deadlines normally applicable to health plans through the Outbreak Period.

In practice, the Outbreak Period allows additional time for individuals to:

  • elect and pay for COBRA,
  • exercise HIPAA Special Enrollment Rights to change plan elections mid-year, and
  • file claims and request appeals of adverse claim decisions.

The Outbreak Period is “disregarded” in counting the days that apply for taking the above actions. This means the clock is “paused” to take these actions until the Outbreak Period is over for that event.

The Outbreak Period began March 1, 2020 and ends on the earlier of (a) one year from the date an individual is first eligible for relief from certain deadlines or (b) 60 days after the end of the National Emergency. Since the National Emergency is expected to end on May 11, 2023, the Outbreak Period would end July 10, 2023. Once the Outbreak Period ends, the normally applicable deadline (such as 30, 45 or 60 days) will apply.

As an example, assume Amelia experienced a COBRA qualifying event on August 31, 2022, but did not elect COBRA. Assume the National Emergency ends as scheduled on May 11, 2023. The Outbreak Period will end for her on July 10, 2023 and she will have 60 days (the normal COBRA election period) after that to elect COBRA (or until September 8, 2023) and another 45 days to pay her retroactive COBRA premiums. If Amelia pays for only part of her COBRA coverage, the payments will be applied to the earliest months first (i.e., starting with August 2022).

When the Outbreak Period ends, the relevant federal agencies had strongly hinted that plan fiduciaries should communicate the end of the Outbreak Period once they know about it. Therefore, plan sponsors may want to consider reaching out to their employees and any COBRA beneficiaries to notify them of the end of the Outbreak Period.

Next Steps and Considerations

With the end of the PHE and National Emergency likely approaching, employers should consider the following:

  • Determine if the plan will continue to cover COVID-19 testing and out-of-network vaccines at 100% without cost sharing, or implement some form of cost sharing or medical management (such as only covering these items at 100% subject to medical necessity).
  • Determine if any plan changes in response to the end of the PHE will be made immediately (subject to applicable notice requirements), or at the beginning of the next plan year.
  • Consider issuing a communication to participants and COBRA beneficiaries announcing changes, which will likely require a summary of material modifications or other communication items. Review your summaries of benefits and coverage to determine if updated ones need to be sent 60 days before these changes. Also review how you communicated previously about the PHE and National Emergency provisions to determine if additional communications are required. Even if they are not required, it may be advisable to notify participants and COBRA beneficiaries to avoid any confusion.
  • Consider planning ahead for the end of the National Emergency and Outbreak Period by understanding the applicable deadlines, including the fact that deadlines will vary by participant.

If you have any questions, please contact your HUB Advisor. View more compliance articles in our Compliance Directory.

NOTICE OF DISCLAIMER

Neither Hub International Limited nor any of its affiliated companies is a law or accounting firm, and therefore they cannot provide legal or tax advice. The information herein is provided for general information only, and is not intended to constitute legal or tax advice as to an organization’s or individual's specific circumstances. It is based on Hub International's understanding of the law as it exists on the date of this publication. Subsequent developments may result in this information becoming outdated or incorrect and Hub International does not have an obligation to update this information. You should consult an attorney, accountant, or other legal or tax professional regarding the application of the general information provided here to your organization’s specific situation in light of your or your organization’s particular needs.