The End of the National Emergency Spells Big Changes for Employers

Since the early days of the COVID-19 pandemic, the country has been under both national emergency and public health emergency orders (the “Emergency Orders”).  Pursuant to these orders, the Departments of Labor, Health and Human Services, and the Treasury (the “Departments”) issued guidance in May 2020 that postponed various deadlines that apply to benefit plans and made other COVID-related changes to health plans while the Emergency Orders are in force (the “Emergency Period”).  After three years, the end has finally come: on January 30, 2023, President Biden announced his intent to end the COVID-19 national emergency and public health emergency effective May 11, 2023, and on Monday, April 10, President Biden signed a congressional resolution immediately ending the national emergency. The ending of the national emergency marks the beginning of the end to several temporary changes to employee benefit plans.

Background

Since President Trump declared the national emergency and the Department of Health and Human Services declared the public health emergency in 2020, the Emergency Orders have been extended several times and have continued to provide relief for employee benefit plans. Under the national emergency, certain ERISA-related deadlines were extended and did not begin to run until the earlier of (i) one year from the applicable deadline, or (ii) 60 days after the end of the national emergency (the “Outbreak Period”). This included the time periods for special enrollment; claims and appeals; and COBRA election, premium payments, and notices.  Additionally, under the public health emergency, certain group health plans were required to expand coverage for COVID-19 tests (including over-the-counter tests) and related diagnostic services and COVID-19 vaccines.

After President Biden announced the May 11, 2023 ending date of the Emergency Period, the Departments prepared a list of Frequently Asked Questions (“FAQs”) that address the impact the end of the national emergency and public health emergency has on benefit plans based on this May 11 date (July 10, 2023 as the end of the Outbreak period). However, President Biden then signed a resolution on April 10, 2023, immediately ending the national emergency on that date instead of May 11, 2023. The public health emergency ended on May 11, 2023, and the DOL has indicated that Outbreak Period will still end on July 10, 2023 despite President Biden’s early end to the national emergency.  Employers and plan administrators should begin preparing for these changes as the emergencies come to an end and the Outbreak Period expires.

Upcoming Changes

On May 11, 2023, the public health emergency ended.  Changes that began after May 11, 2023 include:

• COVID-19 testing: Health plans are no longer required to cover COVID-19 testing at no cost. 
• COVID-19 vaccinations: Non-grandfathered group health plans and health insurance issuers offering non-grandfathered group or individual health insurance coverage must continue covering COVID-19 vaccinations at no cost from an in-network provider but they may impose cost sharing for vaccinations from out-of-network providers.
• Special enrollment: Employees and their dependents are eligible for special enrollment in a group health plan governed by ERISA and the Code until 60 days after the end of the Outbreak Period if:
  • they are otherwise eligible to enroll in the plan,
  • the employee or dependent was enrolled in Medicaid or Children’s Health Insurance Program (“CHIP”) coverage, and
  • the Medicaid or CHIP coverage was terminated as a result of loss of eligibility for that coverage from March 31, 2023 when employees and dependents enrolled in Medicaid or CHIP coverage may lose eligibility) until July 10, 2023 (the end of the Outbreak Period).

Additionally, relief provided under the national emergency will end after the Outbreak Period on July 10, 2023. This includes the reinstatement of the following deadlines:

• The 30-day period (or 60-day period, if applicable) to request special enrollment. The FAQs provide the following examples:
  • Individual C works for Employer Z. Individual C is eligible for Employer Z’s group health plan, but previously declined participation. On April 1, 2023, Individual C gave birth and would like to enroll herself and the child in Employer Z’s plan. However, open enrollment does not begin until November 15, 2023. Individual C and her child qualify for special enrollment in Employer Z’s plan as early as the date of the child’s birth, April 1, 2023. Individual C may exercise her special enrollment rights for herself and her child until 30 days after July 10, 2023 (the end of the Outbreak Period), which is August 9, 2023, as long as she pays the premiums for the period of coverage after the birth.
  • If Individual C gave birth on May 12, 2023 Individual C and her child qualify for special enrollment in Employer Z’s plan as of the date of the child’s birth, May 12, 2023. Because Individual C became eligible for special enrollment on May 12, 2023, after the end of the COVID-19 National Emergency but during the Outbreak Period, the extensions under the emergency relief notices still apply. Individual C may exercise her special enrollment rights for herself and her child until 30 days after July 10, 2023 (the end of the Outbreak Period), which is August 9, 2023, as long as she pays the premiums for the period of coverage after the birth.
  • If Individual C gave birth on July 12, 2023, Individual C and her child qualify for special enrollment in Employer Z’s plan as of the date of the child’s birth, July 12, 2023. Because Individual C became eligible for special enrollment on July 12, 2023, after the end of both the COVID-19 National Emergency and the Outbreak Period, the extensions under the emergency relief notices do not apply. Individual C may exercise her special enrollment rights for herself and her child until 30 days after July 12, 2023, which is August 11, 2023, as long as she pays the premiums for the period of coverage after the birth.
• The 60-day election period for COBRA continuation coverage. The FAQs provide the following examples:
  • Individual A works for Employer X and participates in Employer X’s group health plan. Individual A experiences a qualifying event for COBRA purposes and loses coverage on April 1, 2023. Individual A is eligible to elect COBRA coverage under Employer X’s plan and is provided a COBRA election notice on May 1, 2023. The last day of Individual A’s COBRA election period is 60 days after July 10, 2023 (the end of the Outbreak Period), which is September 8, 2023.
  • If the qualifying event and loss of coverage occur on May 12, 2023, and Individual A is eligible to elect COBRA coverage under Employer X’s plan and is provided a COBRA election notice on May 15, 2023. Because the qualifying event occurred on May 12, 2023, after the end of the COVID-19 National Emergency but during the Outbreak Period, the extensions under the emergency relief notices still apply. The last day of Individual A’s COBRA election period is 60 days after July 10, 2023 (the end of the Outbreak Period), which is September 8, 2023.
  • If he qualifying event and loss of coverage occur on July 12, 2023, and Individual A is eligible to elect COBRA coverage under Employer X’s plan and is provided a COBRA election notice on July 15, 2023. Because the qualifying event occurred on July 12, 2023, after the end of both the COVID-19 National Emergency and the Outbreak Period, the extensions under the emergency relief notices do not apply. The last day of Individual A’s COBRA election period is 60 days after July 15, 2023, which is September 13, 2023
• The date for making COBRA premium payments. The FAQs provide the following example:
  • Individual B participates in Employer Y’s group health plan. Individual B has a qualifying event and receives a COBRA election notice on October 1, 2022. Individual B elects COBRA continuation coverage on October 15, 2022, retroactive to October 1, 2022. Individual B has until 45 days after July 10, 2023 (the end of the Outbreak Period), which is August 24, 2023, to make the initial COBRA premium payment. The initial COBRA premium payment would include the monthly premium payments for October 2022 through July 2023. The premium payment for August 2023 must be paid by August 30, 2023 (the last day of the 30-day grace period for the August 2023 premium payment). Subsequent monthly COBRA premium payments would be due the first of each month, subject to a 30-day grace period.
• The date for individuals to notify the plan of a qualifying event or determination of disability.
• The date within which individuals may file a benefit claim under the plan’s claims procedure.
• The date within which claimants may file an appeal of an adverse benefit determination under the plan’s claims procedure.
• The date within which claimants may file a request for an external review after receipt of an adverse benefit determination or final internal adverse benefit determination.
• The date within which a claimant may file information to perfect a request for external review upon a finding that the request was not complete.
• The date for providing a COBRA election notice.

In light of the end of the Emergency Period:

• We recommend that employers examine their plans and determine whether they wish to change health plan coverage for COVID testing.
• To the extent that employers elect to change health plan coverage for COVID testing and/or vaccines, we recommend they begin preparing to amend their health plans, summary plan descriptions, and notify participants of these change.
• Employers should consider whether they will continue to cover telehealth or other remote care services upon the end of the Emergency Period. To the extent an employer wishes to revoke these benefit, we recommend they provide advance notice to participants at least 60 days before any modifications to the coverage are effective.
• In preparation for the ending of the extended time frames for certain plan benefits on July 10, 2023,  we recommend employers communicate the change in deadlines to impacted employees before the end of the Outbreak Period.
• Employers should inform employees of their group health plan special enrollment right if they were receiving Medicaid or CHIP coverage. The DOL also encourages employers to amend their plans to offer employees more time to exercise this right.  The DOL has provided an informational flyer to offer employees.
• Employers should monitor further IRS guidance if the employer offers a High Deductible Health Plan (“HDHP”).  An HDHP plan may continue to cover COVID-related medical care services and items for testing and treatment before the participant’s satisfaction of their minimum deductible. However, the ability to do this without impacting eligibility to contribute to a Health Savings Account is subject to further IRS guidance.

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