Shared with permission from MZQ Consulting, Inc. The original post is available on their website here.
Friends, have you been talking about when the federal COVID-19 “Outbreak Period” actually ends? Since it’s been a frequent topic of conversation around here, and a matter of confusion amongst some of the smartest benefits compliance professionals we know, we thought it would be a friendly gesture to tell you what we’ve been able to figure out so far!
As a reminder, emergency regulations issued in 2020 created the COVID-19 Outbreak Period and “stopped the clock” for many employer-sponsored health plan deadlines. The Outbreak Period is defined as the period beginning on March 1, 2020, and ending 60 days after the end of the COVID-19 national emergency. The affected deadlines include those related to COBRA continuation coverage, special enrollment periods, claims for benefits, appeals of denied claims, and external review of certain claims. Since Section 518 of ERISA only allows deadline postponement for up to a year, additional federal guidance allowed each individual beneficiary’s “stopped clock” to expire on a case-by-case basis on the earlier of: (1) one year from the date an individual was first eligible for deadline relief, or (2) 60 days after the end of the national emergency period (the end of the Outbreak Period as originally defined).
So, here’s the issue—what exactly does the “end of the national emergency period” mean when it comes to the Outbreak Period rules? Due to COVID-19, the United States has been operating under two national emergency periods for the past three years—the national state of emergency originally declared by President Trump on March 20, 2020, and a national public health emergency declared by the Department of Health and Human Services. For a while, determining the end date was simple—both emergency periods were slated to end on the same day: May 11, 2023. Sixty days after that is July 10, 2023, so that date was assumed to be the end of the Outbreak Period. Then Congress went and mucked it all up. They passed H.J. Res. 7, ending the national state of emergency right away. President Biden signed the measure into law on April 10, 2023.
After that, the health policy nerd world descended into turmoil. Some people assumed the “national emergency” referenced in the rules and definition for the Outbreak Period referred to the federal state of emergency declared by President Trump and extended by President Biden. Under that calculus, the end of the Outbreak Period would move up to 60 days after April 10, 2023, or June 9, 2023. Assuming that the end of the presidentially declared national emergency period is the date to use here is reasonable; after all, the President’s emergency declaration is directly referenced in the Outbreak Period rules. However, the devil is in the details – or in some cases, the footnotes.
As a good friend of ours quickly pointed out, what the original rule actually says (and what the follow-up guidance references via footnote) is “on March 13, 2020, President Trump issued the Proclamation on Declaring a National Emergency Concerning the Novel Coronavirus Disease (COVID-19) Outbreak and by separate letter made a determination, under section 501(b) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121 et seq., that a national emergency exists nationwide beginning March 1, 2020, as the result of the COVID-19 outbreak (the National Emergency). As a result of that determination, the Federal Emergency Management Agency (FEMA) issued emergency declarations for every state, territory, and possession of the United States.”
If in your head you are now saying, “Oh, I must have skimmed over that FEMA part back in 2020 when I was trying to figure out where to buy toilet paper and wondering if the devil created Google Classroom as my own personal torture device. What, pray tell, is the Stafford Act anyway?” you are in good company1. The short version is that there is more to the determination of the end of the Outbreak Period than just considering when the presidentially declared emergency period ends. The Stafford Act declaration has a greater impact on Section 518 of ERISA (the part of the law on which the Outbreak Period rules are predicated). H.J. Res 7 did not end the Stafford Act national emergency determination—FEMA gets to decide when that will end, and FEMA indicates the COVID-19 national emergency is still ongoing and will end on May 11, 2023. The federal Departments of Health and Human Services, Labor, and Treasury (the Departments) seem to concur relative to the Outbreak Period rules and may be issuing clarifying guidance soon. So, bottom line, despite some legal uncertainty, we believe that May 11, 2023 will be utilized as the emergency period end date, making July 10, 2023 the end of the Outbreak Period.
It is important to note that ending the extension of time permitted by the Outbreak Period rules on July 10, 2023 is just a statutory minimum. FAQs issued by the Departments on March 29, 2023 make it clear that group health plan sponsors and health insurance carriers are not only permitted to give plan participants more time, but that they are also specifically encouraged to do so. As compliance nerds, we feel compelled to point out that should a group health plan decide to allow plan participants transitioning away from Outbreak Period rules to have more time, they should do so officially and uniformly, through written communications and appropriate adjustments to Plan documents.
Anyway, using July 10, 2023 as the end of the Outbreak Period, here is a cheat sheet to use regarding applicable health plan dates.
People who experience COBRA qualifying events on or before the official end of the Outbreak Period will have a minimum of 60 additional days after the end of the Outbreak Period to submit their COBRA election notice. Put another way, if the national emergency period ends on May 11, 2023 as we anticipate, the Outbreak Period will end on July 10, 2023. A COBRA election notice that is provided on or before July 10, 2023 will be due back no earlier than 60 days after that, or September 8, 2023. An important note stressed by the guidance is that this election notice relief still applies if the individual qualifies for COBRA before or after the end of the national emergency period. As long as the loss of coverage occurs on or before the end of the Outbreak Period, the individual will have at least 60 days to submit their election notice. Again, carriers and group health plan sponsors may allow more time if they wish.
Any COBRA premiums due for coverage provided during the Outbreak Period may be due no earlier than 45 days after the end of the Outbreak Period. So, again assuming the Outbreak Period ends on July 10th, the premiums will be due on August 24th (or later if a plan sponsor allows for more time).
Special Enrollment Rights
The extension to special enrollment rights applies to any triggering event that takes place during the Outbreak Period. Participants who experienced qualifying events like the birth of a child or a marriage within this timeframe will have 30 days after the end of the Outbreak Period to request special enrollment in a group health plan. If the Outbreak Period does end on July 10, 2023, then special enrollment requests may be due no earlier than August 9, 2023, or September 8, 2023, depending on what type of qualifying event is involved.
Claims and Appeals Deadline Delays
The Outbreak Period rules also extended the deadlines for the submission of health plan claims, appeals of adverse benefit determinations under ERISA plans and non-grandfathered group health plans, and requests for external review after exhausting the plan’s internal appeals procedures. Plan participants will have at least 60 days following the end of the Outbreak Period to address these issues. Assuming the Outbreak Period ends on July 10, 2023, then any such claims requests will be due no earlier than September 8, 2023.
1 The Stafford Act became law in 1988 and amended a version of the Disaster Relief Act of 1974. It created the current framework for the administration of a federal disaster declaration or an emergency declaration through the Federal Emergency Management Agency (FEMA).
Please reach out to your HORAN representative with additional questions at 800.544.8306.
The information contained in this document is informational only and is not intended as, nor should it be construed as, legal or accounting advice. Neither HORAN nor its consultants provide legal, tax nor accounting advice of any kind. We make no legal representation, nor do we take legal responsibility of any kind regarding regulatory compliance. Please consult your counsel for a definitive interpretation of current statute and regulation and their impact on you and your organization.