As everyone scrambles to deal with the unprecedented impact of COVID-19, the U.S. Department of Labor has announced some welcome relief – a general extension of time for meeting many of the deadlines pertaining to health and welfare plans and retirement plans. The extension is retroactive to March 1, and comes on the heels of President Donald Trump’s declaration of a federal emergency. This relief will apply until 60 days after the end of the COVID-19 pandemic or some later date determined by the department.
The department is taking the position that during the COVID-19 emergency, plan sponsors will not be treated as having violated ERISA’s reporting and disclosure rules as long as they make a reasonable effort to do so “as soon as administratively practicable.” For plan sponsors, this means that a delay in providing documents such as annual participant benefit statements, summary plan descriptions, summary of material modifications, summaries of benefit coverages, annual funding notices, and benefit claims and appeals notices will not be actionable as long as the plan sponsor meets the requirements for the extension of time.
The department also has announced that it will not enforce a temporary failure to make a timely deposit of participant contributions or loan repayments to a plan, as long as the plan sponsor makes an effort to end the delay as soon as administratively practicable. Finally, the department guidance also includes the relaxation of the electronic disclosure rules. This will further assist plan sponsors to make a good faith effort to meet the ERISA disclosure requirements by allowing the use of a variety of electronic media. This requires the plan sponsor to reasonably believe the recipient has meaningful access to the electronic communication.
Likewise, plan participants will have additional time to meet certain deadlines, including the election of COBRA continuation coverage and payment of the required premium, pursing a claim for benefits and filing appeals of denied claims. Also, plan participants will have additional time to pursue their special enrollment rights. Under HIPAA, group health plans are required to offer special enrollment rights to employees and their dependents in certain situations, including the loss of eligibility for health coverage or the addition of a new dependent. Normally, a participant would be required to elect the special enrollment within 30 days from the occurrence of the qualifying event. Participants will now have until 30 days after the end of the COVID-19 emergency.
However, as of now, the department has not acted to extend the deadline for the filing of the Form 5500 for the 2019 calendar year plans. If you have any questions about these issues and new deadlines, please contact me.
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