Biden Ends COVID National Emergency Early, Calling Plan Sponsors to Action

(Public Health Emergency Remains in Effect)

President Biden officially declared the end of the COVID-19 National Emergency on April 10, 2023. This came as a surprise to many, as his previous statement indicated the end of the National Emergency would occur May 11th, 2023. In this article, we discuss how Employers and Agents can prepare for the end of the COBRA/continuation coverage "outbreak period"... 

After the House voted 229-197 in favor of the decision, H.J. Res. 7 passed the Senate. While signing the bill immediately ended the COVID-19 National State of Emergency originally put into place by President Trump in 2020, the public health emergency (PHE) remains in effect until further notice. 

Health insurance, healthcare, and group health plans everywhere will be impacted by the changes under the national emergency cessation. 

Employer HR Departments, Insurance Agents, Carriers, and TPAs will have to navigate new waters of administration and employee benefits will change. 

COBRA and COBRA-like continuation coverage such as that offered under State law (state continuation) timeframes were extended under the IRS Notice 2021- 1 (through IRS Notice 2021-58) as the agencies allowed for qualified individuals to have extended deadlines for election, special enrollment, and premium payment. The timeframes were "paused" during the "outbreak period" which began March of 2020, and will end 60 days following the declared end of the National Emergency. 

These suspended timeframes will essentially cease as of the end of the "outbreak period", which is June 9, 2023. Subsequently, beginning June 10, 2023, all of the suspended deadlines such as those for COBRA election or premium due dates, and certain COBRA notices will start to run again. This means Employers will need to take steps to inform their participants of the upcoming deadlines, and Plans will need to account for the time-frames to go back on the pre-COVID clock this summer. 

Examples of End Dates for Qualified Beneficiaries: 

Ex 1. COBRA Election
A qualified beneficiary who experiences a COBRA QE on April 3, 2023 would typically have 60 days from notification to elect COBRA continuation coverage. Because of the disregarded outbreak period, the typical 60-day election period would be suspended until June 9, 2023 -- 60 days following the declared end of National Emergency, April 10, 2023. Subsequently, the Qualified Beneficiary's 60 days to elect would not begin until June 10, 2023, allowing the individual to have until August 9, 2023 to elect COBRA/continuation coverage. 

Ex 2. COBRA Premium Payment (new enrollee)
A qualified beneficiary has a COBRA qualifying event and receives a COBRA Election Notice on October 1, 2022. This individual elects COBRA right away, on October 15, 2022 with coverage retroactive to October 1, 2022. 
Normally, the individual has 45 days to make the initial premium payment for COBRA continuation coverage, followed by subsequent monthly premium payments.  With the suspended timeframes under the "outbreak period", the individual has until 45 days after June 10, 2023, the end of the Outbreak Period) which is July 24th, 2023.  The premium payment for all retro-premiums going back to the October 1, 2022 coverage period would be due no later than July 24th, 2023 with all subsequent premium payments due 1st of each month, subject to a 30-day grace period. 

Ex 3. Regular On-going Monthly Premium Payments
A qualified beneficiary who is enrolled into COBRA continuation effective March 1, 2023, and who has remitted the initial premium payment by April 15, 2023, is going to continue the COBRA coverage for future months. This qualified beneficiary's 30-day monthly premium grace period has been "paused" during the "outbreak period" but the outbreak period ending June 9, 2023 will cause the 30-day grace period to start running again as usual from June 10th. This means that the qualified beneficiary will have until July 9, 2023 to remit all premiums due, up through the current coverage period, and will subsequently have all premiums for June, July and onward become due on the 1st of the month, followed by the typical 30-day grace period. For example, June premiums would be due June 1st with the grace period ending July 1st. 

How Can Employers and Benefits Professionals Prepare? 

The early end to the National Emergency complicates communication efforts because the Public Health Emergency and National Emergency related communications could be sent at the same time with the original intended end date of May 11, 2023. However, with each "emergency" to end at different times, Plan sponsors will likely need to send separate communications for the end of extended timeframes. 

• Review and understand the Agencies newest FAQ release pertaining to the end of the National Emergency so that you understand how the deadlines will impact your COBRA or continuation plan participants and employees. 
• Review benefit summaries and coverage details to determine if you'll need to send new ones. If your plans are going to change, typically a 60-day advance notice is required. Your carrier may handle this for you, but it's worth checking. 
• Check with your third party administrator (or HR team if handling in-house) on how past communications pertaining to the National Emergency extensions of COBRA timeframes were handled, and review possibility of new communication requirements. If you have a COBRA TPA, find out if they are going to notify your plan participants of the changes to deadlines.  
• Contact your regional DOL Advisor's office with any concerns or questions regarding the latest Agencies' release of information on requirements/FAQs/deadlines. 

If your Company needs assistance with navigating the complexities of COBRA continuation administration and the end of the National Emergency, consider outsourcing to an Expert such as CobraHelp. Contact us today! 

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