This means that the "tolling" of a number of participant and plan deadlines did not end on February 28, 2021, as most plan sponsors and others had assumed based on prior guidance. In fact, for some participants, the tolling period could extend far out into the future. In addition, the new guidance reminds plan sponsors and plan fiduciaries of the "guiding principle" for administering employee benefit plans – act reasonably, prudently and in the interest of workers and their families. Good faith compliance with the new guidance will likely be judged on this standard.

Background

Pursuant to joint guidance issued on May 4, 2020 (Joint Guidance), the DOL and Internal Revenue Service (IRS) suspended or "tolled" a number of participant and plan deadlines. The "tolled" deadlines include:

HIPAA Special Enrollment Notice Obligations – the 30-day period (or 60-day period, as applicable) to request special enrollment in a group health plan.
COBRA Notices, Elections and Premium Payments – the periods for individuals to notify the plan of certain COBRA events (e.g., a qualifying event, such as a divorce or child losing eligibility), the 60-day period for electing COBRA continuation coverage, and the 45-day (initial) and 30-day (monthly) deadlines for making COBRA premium payments.
Claims and Appeal Procedures – the date by which an individual may file a claim for benefits or an appeal of an adverse benefit determination (this applies to all ERISA-both welfare and retirement-plans).

Under the Joint Guidance, the deadlines were "tolled" for a period of time called the "Outbreak Period." Based on the Joint Guidance, the "Outbreak Period" was defined as the period beginning on March 1, 2020 (the first day of the COVID-19 National Emergency) and extending to 60 days after the announced end of the COVID-19 National Emergency. However, due to the statutory provisions of ERISA and the Internal Revenue Code, neither the DOL nor IRS had the authority to suspend the "tolled" deadlines for more than one year. Thus, most plan sponsors and plan fiduciaries reasonably assumed that the last day of the "Outbreak Period" and, therefore, tolling period, for all purposes had to be February 28, 2021 (one year from March 1, 2020), even if the COVID-19 National Emergency was still ongoing.

Instant Insights /

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