DOL Announces Rolling Terminations of COVID-19 ERISA Deadline Extensions
By Richard S. Johnson, J.D., executive vice president of PartnerSource
On February 26, 2021, the Department of Labor ("DOL") updated guidance that it previously issued on May 4, 2020 with respect to the COVID-19 pandemic, extending certain reporting and notice deadlines for employee benefit plans. Here is what you need to know about the changes.
PREVIOUS MAY 4, 2020 DOL GUIDANCE
Per the DOL guidance, PartnerSource advised that beginning March 1, 2020, Texas injury benefit plans were required to retroactively suspend the normal initial benefit claim and appeal deadlines applicable to injured Texas employees. This also specified that these claim filing deadlines would remain suspended until 60 days after the President declared that the COVID-19 national emergency has ended.
In May of 2020, PartnerSource clarified that this DOL guidance should not apply to a Texas injury benefit plan’s incident reporting timeframe (for example, reporting no later than 24 hours after a work incident). However, PartnerSource believed that this DOL guidance did apply to:
- any plan rule related to an injured Texas employee’s initial request for medical treatment (for example, receiving medical treatment within 14 days of a reported work incident);
- any plan rule related to ongoing medical treatment (for example, an injured employee not having an unapproved 60-day gap between ongoing medical treatments);
- any plan rule limiting the timeframe that a claimant could submit a medical bill for payment (for example, within 30 days from the date of service or receipt of a bill); and
- any appeal of a denied benefit claim.
UPDATED 2021 DOL GUIDANCE
Under the updated 2021 DOL guidance, Texas injury benefit plans can now terminate any previously suspended reporting timeframe upon the earlier of:
(1) one year from the date the reporting timeframe was originally suspended, or
(2) 60 days after the President ends the COVID National Emergency.
The updated DOL guidance will apply differently depending upon when an affected injured employee’s benefit claim was suspended:
- Claims Incurred Before March 1, 2020 – For these claims, the reporting timeframe had already begun at the time that the DOL ordered the timeframe suspended. Under the new 2021 DOL guidance, the reporting timeframe suspension has now ended as of March 1, 2021 (one year from the date the reporting timeframe was originally suspended), and reporting timeframe clock starts running again.
EXAMPLE: On March 1, 2020, an injured employee had used 60 days of a 180-day timeframe for appealing a denied medical claim. The Plan suspended the appeal timeframe on March 1, 2020. On March 1, 2021, the plan terminates the suspension of this appeal timeframe and the injured employee now has 120 days left to file his/her appeal.
- Claims Incurred After March 1, 2020 and National Emergency Is Ongoing – For these claims, the reporting timeframe suspension will now end one year from the date that the claim’s reporting timeframe was originally suspended.
EXAMPLE: On April 1, 2020, an injured employee had his medical claim denied. On that same date, the plan automatically suspended the 180-day appeal timeframe that would normally apply. On April 1, 2021, the plan terminates the suspension of this claim and the injured employee now has the full 180 days left to file his/her appeal.
- Claims Incurred After March 1, 2020 and National Emergency Has Ended – For these claims, the reporting timeframe suspension will end on the earlier of (1) one year from the date the reporting timeframe was suspended, or (2) 60 days after the President ended the National Emergency (NOTE: as of this writing, the President has NOT ended the national emergency).
EXAMPLE: On October 1, 2020, an injured employee had his medical claim denied. On that same date, the plan automatically suspended the 180-day appeal timeframe that would normally apply. On July 1, 2021, the national emergency formally ends. After 60 days (September 1, 2021), the plan terminates the suspension of this claim and the injured employee now has 180 days left to file his/her appeal.
The updated 2021 DOL guidance specifies that if a claimant is at risk of losing protections or benefits under an employee benefit plan due to the expiration of the maximum one-year suspension limit, the plan’s fiduciaries are urged to notify those affected claimants. This guidance also notes that plan fiduciaries should make reasonable accommodations to prevent the loss or undue delay in benefit payments due to a delay in communication of these changes.
Carefully review with your PartnerSource team and claims handlers how the updated 2021 DOL guidance could affect your Texas Injury Benefit Plan, such as:
- Reviewing your plan documents and employee communication materials;
- Reviewing and updating your client service instructions and appeals procedures for claims handling;
- Updating template letters used for acknowledging new benefit claims and issuing benefit claim denials;
- Notifying claimants with suspended reporting deadlines about how the updated 2021 DOL guidance affects their initial benefit claim or appeal reporting timeframe;
- Adjusting claim audit processes; and
- Training claims adjusters on administering the updated 2021 DOL guidance.
For more information, please contact your PartnerSource team leader. You can also find additional employee benefit plan guidance on the updated 2021 DOL guidance for COVID-19 here.