On June 3, 2020, the Treasury Department issued Notice 2020-42 providing temporary relief from the requirement for a plan representative or notary public to be physically present to witness certain participant elections (including spousal consents), which has been exceptionally difficult to satisfy while following COVID-19 shelter-in-place orders and social distancing guidelines.
The U.S. Department of Labor (DOL) has issued final regulations that provide an additional safe harbor method of satisfying the ERISA electronic disclosure requirements for retirement plans (note, these rules do not apply to welfare plans). The final regulations will allow employers to post retirement plan disclosures online or deliver them by email.
The new electronic disclosure regulations will be published in the Federal Register on May 27, 2020; for your convenience, we have provided an unpublished copy here.
As people across the country react to the quickly changing COVID-19 pandemic, Congress passed another piece of legislation providing guidance and relief on a variety of issues — the Coronavirus Aid Relief and Economic Security (CARES) Act, signed into law on March 27, 2020. This article includes brief summaries of what employers should know about key benefits-related components of the CARES Act. Plan sponsors should review their plans to assess the impact of these changes and take appropriate steps to implement the changes (some of which are required).
HIPAA in the Time of Coronavirus
Group health plans and other entities covered by the Health Insurance Portability and Accountability Act of 1996 (HIPPA) should consider the bulletin released by the Department of Health and Human Services (Bulletin) as a reminder that their HIPAA obligations continue to apply even during a public health emergency, such as the Novel Coronavirus Disease (COVID-19) outbreak.
The Bulletin reiterates the circumstances under which HIPAA currently permits an individual’s protected health information (PHI) to be used and disclosed in an emergency situation and those circumstances applicable to group health plans are generally discussed below. Plan sponsors may want to review their group health plan’s use and disclosure procedures to confirm these permitted exceptions are correctly included.
As of the date of this post, there has been no legislation or IRS guidance allowing plan sponsors to permit cafeteria plan participants to make COVID-19 related mid-year election changes, other than those which also meet the current requirements of the employer’s cafeteria plan and applicable law. However, employers may find themselves faced with an increase in employee requests to change their cafeteria plan elections in response to employees’ rapidly changing circumstances in light of COVID-19.
The table below highlights a few of the mid-year election change requests anticipated as employees and employers respond to the social distancing and economic impact of COVID-19. Plan sponsors should confirm that their plan is not more restrictive than the general mid-year election changes permitted by law which are described here, and as with any mid-year election change request, a change is permitted only when it is consistent with the event and the terms of the plan.
The IRS Office of Chief Counsel recently issued a memorandum (https://www.irs.gov/pub/irs-lafa/20200801f.pdf) that responded with a resounding “No” to the question of whether an employer shared responsibility payment (ESRP) imposed under Internal Revenue Code §4980H is subject to any statute of limitations on assessment.