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How Many Years Is A One Year Extension? DOL Clarifies its Disaster Relief Guidance

How Many Years Is A One Year Extension? DOL Clarifies its Disaster Relief Guidance

| February 26, 2021
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The Department of Labor (DOL) has released Notice 2021-01, which clarifies the end date for the relief
provided in April 2020 under Notice 2020-01. Per the latest guidance, individuals (and plans) are granted relief
based on their own fact-specific timeframes and, therefore, may still take advantage of the relief beyond
February 28, 2021 until the earlier of (a) 1 year from the date they were first eligible for relief, or (b) 60 days
after the announced end of the COVID-19 National Emergency.

As background, in April 2020 the DOL announced that certain deadlines under ERISA were suspended starting
March 1, 2020 until 60 days after the announced end of the COVID-19 National Emergency or such other date
determined by the agencies (the “Outbreak Period”). The following deadlines applicable to participants and
beneficiaries are tolled (paused) during the Outbreak Period:

  • The 30-day period (or 60-day period, if applicable) to request a HIPAA special enrollment;
  • The 60-day period for electing COBRA continuation coverage;
  • The date/deadline for making COBRA premium payments;
  • The deadline for individuals to notify the plan of a COBRA qualifying event or determination of disability;
  • The deadline within which employees can file a benefit claim, or a claimant can appeal an adverse benefit
    determination, under the group health plan or disability plan claims procedures described in the plan;
  • The deadline for claimants to file a request for an external review after receipt of an adverse benefit
    determination or final internal adverse benefit determination; and
  • The deadline for a claimant to file information to perfect a request for external review upon finding that the
    request was not complete.

Certain deadlines impacting employers/plan sponsors were also extended, such as the deadline to provide a
COBRA election notice, among others. This alert focuses on the deadlines applicable to participants, as we
recommend employers send any required notices as soon as practicable despite any extensions available from
the DOL.


Section 518 of ERISA allows the DOL to suspend deadlines for a period of up to one year due to a declared
public health emergency. Generally, that would mean because the relief was announced effective March
1, 2020, it would end after February 28, 2021. However, the DOL (in coordination with IRS and HHS) has
interpreted the one-year relief to apply on an individual or plan basis. Accordingly, individuals and plans are
granted relief for their own fact-specific timeframes and, therefore, may still take advantage of relief beyond
February 28, 2021 until the earlier of (a) 1 year from the date they were first eligible for relief, or (b) 60 days
after the announced end of the National Emergency (the end of the Outbreak Period).

For example, if an employee was required to make a COBRA election by March 1, 2020, they have until the
earlier of March 1, 2021 or the end of the Outbreak Period to elect COBRA. Likewise, if someone was required
to elect COBRA by March 1, 2021, they will have until the earlier of March 1, 2022 or the end of the Outbreak
Period to make an election.


The guidance emphasizes the importance of notifying participants and beneficiaries regarding this relief and
how it impacts them. The guidance provides the following examples:

  • If a plan administrator or other responsible plan fiduciary knows, or should reasonably know, that the
    end of the relief period for an individual action is exposing a participant or beneficiary to a risk of losing
    protections, benefits, or rights under the plan, then they should send a notice regarding the end of the
    relief period.
  • Any required plan disclosures issued prior to or during the pandemic may need to be reissued or amended
    if they failed to provide accurate information regarding the time in which participants and beneficiaries
    were required to take action, e.g., COBRA election notices and claims procedure notices.
  • Plan sponsors of group health plans should consider ways to ensure that participants and beneficiaries
    who are losing coverage under their group health plans are made aware of other coverage options that
    may be available to them, including the opportunity to obtain coverage through the Health Insurance
    Marketplace in their state.


What Does This Mean For Employers and Group Health Plan Sponsors?

In an already complicated world, things just became increasingly more complicated. Employers should work
with their third party administrators, such as COBRA vendors, to ensure any notices previously provided to
individuals are updated pursuant to the new guidance. This includes any COBRA general notices, election
notices, grace period notices, SPDs, or other plan materials that may articulate the incorrect deadlines to
individuals. Further, employers and administrators should ensure participants and beneficiaries are adequately
notified prior to their individualized relief is coming to an end.


About the Author. This alert was prepared for Alera Group by Marathas Barrow Weatherhead Lent LLP, a national law
firm with recognized experts on ERISA-governed and non-ERISA-governed retirement and welfare plans, executive
compensation and employment law. Contact Danielle Capilla at Danielle.capilla@aleragroup.com

The information provided in this alert is not, is not intended to be, and shall not be construed to be, either the provision
of legal advice or an offer to provide legal services, nor does it necessarily reflect the opinions of the agency, our lawyers
or our clients. This is not legal advice. No client-lawyer relationship between you and our lawyers is or may be created by
your use of this information. Rather, the content is intended as a general overview of the subject matter covered. This
agency and Marathas Barrow Weatherhead Lent LLP are not obligated to provide updates on the information presented
herein. Those reading this alert are encouraged to seek direct counsel on legal questions.
© 2021 Marathas Barrow Weatherhead Lent LLP. All Rights Reserved.

The information contained herein should be understood to be general insurance brokerage information only and does not constitute
advice for any particular situation or fact pattern and cannot be relied upon as such. Statements concerning financial, regulatory or
legal matters are based on general observations as an insurance broker and may not be relied upon as financial, regulatory or legal
advice. This document is owned by Alera Group, Inc., and its contents may not be reproduced, in whole or in part, without the written
permission of Alera Group, Inc.

Updated as of 02/26/2021.

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