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<< Older News  |  December 4, 2020


All News > COBRA

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Health and Welfare Benefits: 2020 Year in Review (PDF)
Alston & Bird Link to more items from this source
[Guidance Overview]
Dec. 3, 2020

35 presentation slides. Topics: [1] Legislative Developments; [2] Regulatory Developments -- Non-COVID: Final Health Plan Transparency Rules, ICHRA Final Rule and Follow-up Guidance on Pay-or-Play and Non-Discrimination Requirements, DOL Electronic Disclosure Rule (for qualified plans), New SBC requirement for 2021, 2021 NBPP (includes some important HSA guidance re: coupons), Direct Primary Care, and Grandfather Rule Relief; [3] Misc. Sub-Regulatory Developments: 2021 Cost-of-living Adjustments for Popular Benefits; [4] Health Plan Litigation Developments; [5] Recap of Coronavirus Impact on Employer H&W Benefits; [6] State Law Potpourri; [7] Cafeteria Plan, Grace Period, and Carry-Over Relief; and [8] COBRA, Claims and Appeals, and Special Enrollment Extensions.

Tags: COBRA  •  Coronavirus (COVID-19)  •  Health Plan Administration  •  Health Plan Design

The 2022 Proposed Payment Notice: Medical Loss Ratios, Special Enrollment Periods, and More
Katie Keith, via Health Affairs Blog Link to more items from this source
[Guidance Overview]
Nov. 30, 2020

"CMS proposes to amend the definition of prescription drug rebates and other price concessions in its MLR formula.... The 2022 proposed payment notice includes no changes regarding the coverage of essential health benefits (EHB) and instead merely lays out timelines for state reporting.... CMS proposes a series of changes to special enrollment periods (SEPs) for exchange enrollees who become newly eligible for APTC and for those who are eligible for a SEP but did not receive timely notice of the triggering event. CMS also addresses the cessation of employer contributions to COBRA."

Tags: COBRA  •  Health Plan Administration  •  Health Plan Design  •  Prescription Drug Costs

Keeping COBRA Notices Compliant in an Ever-Changing Landscape
Trucker Huss Link to more items from this source
[Guidance Overview]
Nov. 25, 2020

"This article [describes] what employers should keep in mind while updating their COBRA notices, including [1] recent revisions to the [DOL's] model COBRA notices in May 2020, [2] the mandatory extensions to certain COBRA-related deadlines due to the COVID-19 pandemic, and [3] the allegations in the many class-action lawsuits filed over the last few years alleging deficiencies in COBRA notices."

Tags: COBRA  •  Coronavirus (COVID-19)

Fall 2020 Employee Benefits Briefing
Nixon Peabody LLP Link to more items from this source
Nov. 20, 2020

Audio recording. "[1] Fiduciaries should generally only consider pecuniary factors when choosing investments for plans that are subject to ERISA. [2] Plan sponsors should review their missing participant procedures in light of recent IRS guidance on tax reporting and withholding for accounts remitted to state unclaimed property funds. [3] Plan sponsors should review their health and welfare plan documents and consider whether any provisions can be added to mitigate against litigation risk and unnecessary expenditures.... [4] Fiduciaries should remain diligent in monitoring their plan's investment fund lineup, reviewing recordkeeping fees, and documenting their processes when making decisions involving the plan.... [5] Plan sponsors should review and update their COBRA documentation to make sure there are no deficiencies, and consider auditing their health plan's compliance with the mental health parity requirements."

Tags: COBRA  •  Fiduciary Duties  •  Health Plan Administration  •  Retirement Plan Administration

Navigating the COBRA Deadline Extension
Cohen & Buckmann, P.C. Link to more items from this source
[Guidance Overview]
Nov. 18, 2020

"Earlier this year, the COBRA notice, election and premium payment deadlines were extended from March 1 until 60 days after the end of the ongoing COVID-19 national emergency.... [T]he IRS and EBSA have not addressed whether administrators should correct previously sent COBRA election notices. The fact that COBRA election notices are not required until the end of the extension period suggests that interim corrections are not required. However, while the usual statutory penalties for COBRA violations should not apply, failing to notify COBRA qualified beneficiaries of their rights may increase the likelihood of a breach of fiduciary duty claim."

Tags: COBRA  •  Coronavirus (COVID-19)

What Happens When COBRA Deadlines Become Suggested Time Limits?
Paul M. Hamburger of Proskauer Rose LLP, via HR Daily Advisor Link to more items from this source
Nov. 16, 2020

"From a public policy perspective, it is ... hard to see how open-ended COBRA notice, election, and premium payment periods are a good thing.... [A]nother way to balance the need for relief with the need for structure would have been to double all the applicable time periods. Perhaps the guidance could have also added another option for adversely affected qualified beneficiaries to request an additional 30 days on top of that if they request relief in a timely fashion."

Tags: COBRA  •  Coronavirus (COVID-19)

Employee Benefit Developments in 2020 (PDF)
Holland & Hart LLP, via Tax Executive Link to more items from this source
Nov. 13, 2020

"PEPs ... Lifetime income demonstrations ... Expanded access to 401(k) plans for part-time workers ... Optional distributions for qualified birth or adoption expenses ... Determination letters and opinion letter 'cycles'... Fiduciary duties of retirement plan investments ... COBRA penalties."

Tags: 401(k) Plans  •  COBRA  •  Fiduciary Duties  •  Retirement Plan Investments

COVID-19 Extension Guidance Makes the Interplay Between COBRA and Medicare (A Bit) Trickier
Verrill Dana LLP Link to more items from this source
[Guidance Overview]
Nov. 3, 2020

"Because the deadline for a qualified beneficiary to make a COBRA election typically occurs close in time to the date his or her coverage terminates, some employers have incorrectly assumed that COBRA continuation coverage must be offered only if the qualified beneficiary was entitled to Medicare before the qualified beneficiary's loss of coverage or qualifying event.... Because, under the Joint Notice, a qualified beneficiary's COBRA election could take place months after his or her qualifying event or loss of coverage date, employers must be sure to provide COBRA election notices to, and credit the COBRA elections of, qualified beneficiaries who enroll in Medicare after their qualifying event or loss of coverage date."

Tags: COBRA  •  Medicare

Can an Employer Terminate COBRA Coverage During the Pandemic’s Outbreak Period?
Kushner & Company Link to more items from this source
[Guidance Overview]
Nov. 2, 2020

"The question the employer should ask themselves is, 'How do I normally (in a non-pandemic time) treat those individuals from the date of the qualifying event until the first payment is received?' A similar question is 'How do I normally (in a non-pandemic time) treat individuals who are in the [normal] 30-day grace period for payments?' "

Tags: COBRA  •  Coronavirus (COVID-19)

Editor's Pick When Can Employers Terminate COBRA Coverage During the COVID-19 Outbreak Period?
Miller Johnson Link to more items from this source
[Guidance Overview]
Oct. 29, 2020

"With the lack of guidance from the DOL and IRS ... it makes sense for a plan to treat a qualified beneficiary's COBRA coverage status during the election period and payment period -- which are lengthened by the outbreak period -- using the same method as the plan treats a qualified beneficiary's COBRA coverage status during the election and payment periods absent the outbreak period. And, whatever option a plan chooses, it must make sure that a qualified beneficiary's COBRA coverage status during the election and payment periods is clearly communicated to any health care provider that inquires."

Tags: COBRA  •  Coronavirus (COVID-19)

New Plan Year, New COBRA Vendor. New Headaches?
HUB International Link to more items from this source
Oct. 26, 2020

"Late offers of COBRA are most likely to arise when the loss of coverage occurs immediately before a new COBRA administrator begins providing services to a plan. Claims-related challenges could arise in any situation where delays in processing elections and payments occur because they were submitted to a previous COBRA administrator. However, there are some best practices that can help employers avoid these types of situations[.]"


Waiting on an End to the Extended ERISA Deadline Periods
Holland & Hart LLP Link to more items from this source
Oct. 19, 2020

"Early in the pandemic, the IRS and DOL issued a temporary rule (published May 4, 2020) extending certain deadlines applicable to retirement plans and health and welfare plans.... The examples in the temporary rule assumed an end date of April 30, 2020 for the National Emergency, which would have extended the Outbreak Period through June 29, 2020. As we all now know, this National Emergency did not end on April 30, and in fact it is still in place.... As the crisis has extended, the impact of the 'temporary rule' is becoming more of an issue."

Tags: COBRA  •  Coronavirus (COVID-19)  •  Health Plan Administration

How COVID-19 Rules Changes Affect Benefits Compliance Strategy
HUB International Link to more items from this source
[Guidance Overview]
Oct. 12, 2020

"[1] CARES Act: coverage of COVID-19 testing and COVID-19 antibody testing and preventative care (mandated) ... [2] CARES Act: telehealth and high deductible health plans (optional) ... [3] CARES Act and reimbursements for over-the-counter drugs and women's products (optional) ... [4] COBRA changes may have significant impact on employers (mandated) ... [5] HIPAA Special enrollment rights -- Expanded timeframes (mandated change) ... [6] ERISA claims procedures and COVID-19 (mandated change) ... [7] Mid-year election year changes expanded (optional)."

Tags: CARES Act  •  COBRA  •  Coronavirus (COVID-19)  •  HIPAA  •  Health Plan Administration  •  Health Plan Design

ERISA and COBRA Rules Apply to EAPs and Wellness Programs
Verrill Dana LLP Link to more items from this source
Sept. 29, 2020

"If an employer offers only discount gym memberships and free seminars on exercise and nutrition, the employer's wellness program does not provide medical care or benefits in the event of sickness and is not subject to ERISA.... If an EAP maintained by an employer provides only referral services, then it does not provide health care and is not a health plan for purposes of COBRA. In contrast, if the EAP provides health care, it must provide COBRA continuation coverage to employees and dependents that lose health care coverage under the EAP due to a qualifying event."

Tags: COBRA  •  Health Plan Administration  •  Health Plan Design

PHSA COBRA Claim Dismissed for Lack of a Remedy
Thomson Reuters / EBIA Link to more items from this source
Sept. 24, 2020

"The employer did not dispute that it had violated COBRA but argued that the employee's requested relief was statutorily barred under the Public Health Services Act (PHSA) ... The court acknowledged that the statute might allow the employee to seek payment in the form of equitable restitution if the employer held money or property that belonged to him. But, in this case, the employee made no such allegations; rather, he requested money damages to cover expenses he incurred from third parties. Such a remedy is not equitable relief, the court concluded, and thus is not available under the PHSA." [Loizon v. Evans, No. 18-2759 (N.D. Ill. Sep. 3, 2020)]


Impact of the COBRA Extension Interim Final Rule
International Foundation of Employee Benefit Plans [IFEBP] Link to more items from this source
[Guidance Overview]
Sept. 14, 2020

"Under the temporary rule, once the administration declares the national emergency over, COBRA beneficiaries can keep their COBRA options open for 120 days -- 60 days after the national emergency is declared over, with another 60 days allowed as part of the existing COBRA rule. During the outbreak period, there are no deadlines for beneficiaries to elect COBRA."

Tags: COBRA  •  Coronavirus (COVID-19)

Editor's Pick Avoiding Headaches: COVID-19 Guidance and Switching Vendors
HUB International Link to more items from this source
Aug. 25, 2020

"If employers are changing COBRA vendors as part of their renewal, the new vendor MUST receive the historical election, enrollment and payment data all the way back to at least the beginning of [2020] There may be potential COBRA beneficiaries who are still able to elect and pay for COBRA due to the [COVID-19 outbreak period (OP)], so new vendors need to know about them.... Employers who are changing medical carriers as part of their renewals need to make sure the old carriers are equipped to accept retroactive enrollments related to the OP while coverage with that carrier was in force. Likewise, they'll need to make sure new medical carriers are equipped to accept delayed enrollments related to the OP."

Tags: COBRA  •  Coronavirus (COVID-19)  •  Health Plan Administration

What Health and Welfare Plan Sponsors Should Be Thinking About Now
Faegre Drinker Link to more items from this source
Aug. 18, 2020

"[1] Have you issued a summary of material modifications (SMM) for any changes you've made to your plan for COVID-19 testing/ treatment and for telemedicine? ... [2] Have you talked to your vendors about the extensions the agencies created between March 1, 2020, and the end of the pandemic period (as yet unknown) for COBRA, special enrollment and claims periods? ... [3] Have you reviewed your COBRA notices for accuracy/conformance to the COBRA regulations in light of increased litigation in this area?"

Tags: COBRA  •  Coronavirus (COVID-19)  •  Health Plan Administration  •  Health Plan Design

Benefits Litigation to Watch for Post-Pandemic
Holland & Knight, via Law360 Link to more items from this source
Aug. 11, 2020

"When the coronavirus pandemic subsides, employers can expect a spike in litigation over employee retirement plan investments, notices to laid-off workers about benefit rights, and companies' handling of retirement and health plans after furloughs or layoffs. Lawsuits over employee stock ownership plan transactions and benefit claim denials are also expected to tick up[.]"

Tags: COBRA  •  Coronavirus (COVID-19)  •  Fiduciary Duties  •  Health Plan Administration  •  Retirement Plan Administration  •  Retirement Plan Investments

Administering COBRA Notices in the COVID-19 World of Extended Deadlines
HR Daily Advisor Link to more items from this source
[Guidance Overview]
Aug. 6, 2020

"[S]ome plan administrators are considering the possibility of just restarting all the COBRA periods (whether it is the election period or premium payment period) at the end of the outbreak period. The primary consideration seems to be ease of administration.... Here are some of the key issues to consider ... [1] Adverse selection risk.... [2] Reconciling the extension with prior communications.... [3] Addressing claims and coverage issues.... [4] Impact of other coverage during the outbreak period.... [5] Is the plan insured or self-insured?"

Tags: COBRA  •  Coronavirus (COVID-19)

ERIC Letter to U.S. Senate Suggesting Employee Benefits Provisions for Potential COVID-19 Legislation (PDF)
The ERISA Industry Committee [ERIC] Link to more items from this source
July 27, 2020

"ERIC urges that the following provisions be included in potential COVID-19 legislation: [1] Prevent abusive 'stock drop' lawsuits, if the plaintiff cannot prove that the volatility of the investment was due to a cause other than COVID-19; [2] Prevent abusive 'imprudent investment' lawsuits, if the plaintiff cannot prove that the volatility of the investment was due to a cause other than COVID-19; [3] Prevent abusive COBRA lawsuits, by clarifying that it is the responsibility of a plan participant to disclose to providers the source of their health insurance coverage; [4] Prevent abusive ERISA disclosure lawsuits, by requiring plaintiffs to demonstrate actual harm in a case based on failure to provide an ERISA-required disclosure or respond to a document request in a timely manner; and [5] Protect employers from excessive HIPAA liability, by permitting employers to collect and use information related to COVID-19 infections among their worker population."

Tags: COBRA  •  Coronavirus (COVID-19)  •  Fiduciary Duties  •  HIPAA  •  Retirement Plan Investments

Administration Eases Rules to Give Laid-Off Workers More Time to Sign Up for COBRA
Kaiser Health News Link to more items from this source
July 20, 2020

"[G]iving people more time to sign up for COBRA leaves the door open for hospitals or other providers to offer to pay sick patients' back premiums in order to increase their own payment above what they'd receive if someone were on Medicaid or uninsured. Doing so could be a boon for some patients but raise health care costs for employers[.]"


Recent COBRA Developments Call for Employer Attention
Davis Wright Tremaine LLP Link to more items from this source
[Guidance Overview]
July 10, 2020

"The [DOL's] posting of revised model COBRA notices, the extension of various key COBRA deadlines and several class actions filed against employers for allegedly deficient COBRA notices all highlight the need to revisit COBRA compliance."

Tags: COBRA  •  Coronavirus (COVID-19)

COBRA: A Closer Look at Who Enrolls and the Case for Subsidies
Employee Benefit Research Institute [EBRI] Link to more items from this source
July 10, 2020

"COBRA beneficiaries are more likely than those receiving coverage through a full-time employee to have certain health conditions ... and they are more likely to have spent more days in a hospital than those receiving coverage through a full-time employee. The average COBRA beneficiary uses more health care services and spends significantly more than the average person covered by insurance via a full-time employee.... Subsidies can help reduce adverse selection against COBRA plans."

Tags: COBRA  •  Health Plan Costs

COBRA and Costly Consequences of Non-Compliant Notices
Akerman Link to more items from this source
[Guidance Overview]
July 8, 2020

"There are many ways an employer's COBRA notices may be deficient ... [such as] using confusing verbiage that the average employee may not understand, failing to explain the COBRA enrollment process, failing to describe consequences of delayed enrollment or payment, omitting the mandatory 'explanatory information' regarding coverage, and not including the contact information for the administrator of benefits. The last 10 years have seen numerous cases filed surrounding COBRA notice obligations."


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