Health & Welfare Plans Newsletter

May 4, 2020

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View Coronavirus (COVID-19) News and Resources

[Guidance Overview]

New Guidance Provides Relief and Extension of Deadlines to Employee Benefit Plans, Participants and Service Providers

"As of the date of publication, the national emergency will expire July 25, 2020, meaning the Outbreak Period would be March 1, 2020 to September 23, 2020. Thus, for example, an employee who previously declined group health plan coverage and had a baby on March 27, 2020, would have until October 23, 2020, to enroll herself and her child in coverage. Similarly, a participant who loses group health plan coverage and receives a COBRA election notice on May 1, 2020, would have until November 22, 2020, to elect COBRA."

Reinhart Boerner Van Deuren s.c.

[Guidance Overview]

IRS and DOL Jointly Issue Final Rule Extending Time Frames for Plans, Participants and Beneficiaries

"[S]elf-insured plan sponsors will have to adjust their internal administration processes or coordinate with their third party administrator with respect to claims processes so that participants receive correct information regarding the claims and appeals deadlines ... HIPAA special enrollment rights will need to be administered carefully.... COBRA presents special issues for compliance with the final rule."

Hawley Troxell

[Guidance Overview]

Hitting 500: Updated DOL Rule Clarifies Aggregation of Employees Under the FFCRA

"Employers should exercise caution in oversimplifying the Integrated Employer and Joint Employer analyses to avoid coverage under the Act. An employer who takes the position that they are an Integrated Employer or Joint Employer for purposes of avoiding coverage under the Act may later find they waived their ability to assert they are separate entities in litigation or other disputes."

Polsinelli PC

[Guidance Overview]

San Francisco Employees with Medical Reimbursement Accounts Can Now Access Funds for Necessities During COVID-19

"Under the SF City Option, employees on whose behalf such contributions have been made may be offered Medical Reimbursement Accounts (MRAs), which these employees can access to be reimbursed for eligible medical expenses.... On April 28, 2020, ... San Francisco Mayor London Breed announced an immediate expansion of the authorized uses of MRA funds ... to cover 'necessary expenses,' including food, rent, mortgage payments, and utilities."

Davis Wright Tremaine LLP

[Guidance Overview]

COVID-19 Triggers New State and Local Paid Leave Mandates (PDF)

26 pages; updated May 1, 2020. "[S]ome state and local authorities have begun to implement new paid leave requirements. Other jurisdictions are modifying existing leave laws or benefit programs ... This [article] provides brief summaries of new state and local paid leave benefits, as well as guidance addressing how current paid leave benefits apply during the COVID-19 pandemic."

Mercer

[Guidance Overview]

Educational Assistance Programs Allow Employers to Pay Their Employees' Student Loans with Pre-tax Dollars (PDF)

"Not all student loan payments qualify. [1] The statute requires that the payments must be made by the employer on or after the date of enactment (March 27, 2020) and before January 1, 2021. [2] The loan with respect to which the payments are made must have been incurred by the employee for the employee's education. Loans taken out by a parent of the employee will not qualify. Neither will a loan for the education of an employee's child. [3] An employer may choose to make loan payments directly to the lender or to reimburse the employee for payments already made by the employee."

Boutwell Fay LLP

Editor's Pick Fear of Coronavirus Isn't Covered by FFCRA

"If an employee chooses to self-quarantine out of fear, the worker would not be entitled to FFCRA benefits, even if the employer permits the employee to self-quarantine ... An employee who is experiencing COVID‑19 symptoms is entitled to leave under the FFCRA only if the employee seeks a medical diagnosis or if a health care provider directs or advises the employee to stay home."

Society for Human Resource Management [SHRM]; membership may be required to view article

Editor's Pick CARES Act Offers New Options for Cafeteria Plan Sponsors

"Employers that offer a cafeteria plan that includes a health flexible spending account (FSA), health savings account (HSA), or health reimbursement arrangement (HRA) may amend those arrangements to permit reimbursement for drugs purchased without a prescription.... The CARES Act essentially returns the cafeteria plan rules to those in effect prior to the passage of the ACA.... These are permissive changes, but employers looking for a way to offer some good news to their employees may want to consider making them."

Spencer Fane

Benefits in General

[Guidance Overview]

New Rules Provide for Extensions of Benefit Plan Compliance Deadlines

"[P]lan sponsors will need to closely track dates on which certain notices and events have occurred. They will then need to 'keep open' the relevant period, which could require changes to software or systems and require HR departments to closely track these dates.... [T]he DOL will not assert an ERISA violation for the increased loan amounts available under the CARES Act. Some commentators have worried about the 'adequate security' and 'reasonably equivalent basis' rules for the increased loan limits. However, these rules will not be enforced for loans available under the CARES Act."

Husch Blackwell

[Guidance Overview]

DOL Provides Sweeping Deadline Extensions and Other Relief for Plans, Participants and Beneficiaries

"The relief is retroactive to March 1, 2020 and will apply until 60 days after the announced end of the national emergency ... To the extent the emergency ends on different dates for different parts of the country, the DOL will issue additional guidance regarding the application of the relief to those areas. The guidance effectively tolls the deadlines for various actions until after the Outbreak Period End Date."

Ropes & Gray LLP

[Guidance Overview]

Editor's Pick Mandatory Extensions of Certain HIPAA, COBRA and Claims Deadlines, in Chart Format (PDF)

"[EBSA and the IRS] have provided relief to certain plan participants, which plan sponsors and administrators will be required to implement. Essentially, the plan must disregard the coronavirus 'Outbreak Period' when it is calculating certain plan deadlines.... [A] chart describes how this extension works for several of the deadlines."

Poyner Spruill LLP

Editor's Pick Society of Actuaries Research Brief: Impact of COVID-19 on Health Insurers, Retirement Plans and More (PDF)

78 pages; updated May 1, 2020. "A confluence of risks has come together. Operational and financial risks have emerged, compounding the current situation. Actuaries will be watching for any additional risk events that layer on to the current environment, especially ones that may cause additional property, mortality and health risks such as catastrophic weather events."

Society of Actuaries

Press Releases

Most Popular Items in the Previous Issue

EBSA Issues New COBRA Model Notices for Employee Benefit Plans
Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

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BenefitsLink Health & Welfare Plans Newsletter, ISSN no. 1536-9595. Copyright 2020 BenefitsLink.com, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of BenefitsLink.com, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

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