Last October, Brenda Berg posted a blog titled “I’m Just Waiting on an… End to the Extended ERISA Deadline Periods.” In that blog, Brenda explained that the IRS and DOL extended certain deadlines applicable to retirement plans and health and welfare plans.
In sum, under last year’s DOL guidance, employers were required to disregard the period from March 1, 2020 until 60 days after the president declared the COVID Pandemic National Emergency over (the “Outbreak Period”) in calculating employee notices and election deadlines for deadlines including the following:
The Outbreak Period technically ended on February 28, 2021 in compliance with a federal law that limits the DOL’s ability to extend ERISA election periods to no more than 12 months. This past week, the DOL published additional guidance on the COVID-19 ERISA deadline relief (See EBSA Disaster Relief Notice 2021-1). The DOL adopted an approach where, in essence, each individual will have a one-year extension to elect COBRA, pay a premium or elect certain HIPAA special enrollment rights.
The immediate impact of this relief will be on any individual whose applicable ERISA deadline has already been extended for one year. Effective March 1, 2021, these individuals must complete their election or pay the applicable premiums within whatever period remained for those individuals as of February 28, 2020. In other words and for ease, one should calculate the due date for the applicable election or COBRA premium (under standard ERISA election rules) for an individual and add one year. That will be the new deadline applicable to that employee (unless the national emergency ends before that date). For example, an employee who was required to elect COBRA by July 31, 2020 (based on the standard 60-day election rule under COBRA) will now have until July 31, 2021.
The DOL calls on employers, pursuant to their fiduciary duties, to:
Plan sponsors should identify their impacted plans and deadlines and determine whether any notices need to be updated or sent at this time. Plan sponsors should also check with their TPAs, COBRA administrators, etc. to confirm how they are administering this guidance.