Amid the COVID-19 pandemic, Wisconsinites, along with the rest of the nation, have endured sudden and severe job loss. As of May 14, 2020, the University of Wisconsin Center for Research on the Wisconsin Economy estimated the Wisconsin unemployment rate to be 21.9%. In addition to the significant financial losses that attend such massive changes in employment status, job loss often results in the loss of health coverage. Recent data indicates that roughly 57% of Wisconsin’s non-elderly population (i.e., non-Medicare) obtain their health insurance through an employer.
As many are familiar, one of the health insurance options available to those who lose their employment and employer provided health insurance is to apply for COBRA, which allows an employee and his or her dependents to maintain coverage at their own expense by paying the full cost of the premium. Of course, there are certain deadlines that apply to seeking COBRA coverage. Normally, a person has 60 days from the date of receipt of the COBRA notice to elect COBRA (election period), and then 45 days after the date of COBRA election to make the initial premium payment (premium payment period).
However, with the sudden and massive job losses due to the COVID-19 pandemic, on May 4, 2020, the U.S. Department of Labor and the IRS extended these standard COBRA deadlines. Under the new rule, many COBRA deadlines are extended beyond the “Outbreak Period,” which is defined as March 1, 2020, to 60 days after the end of the National Emergency declaration. The relief specifically directs all group health plans subject to ERISA or the IRS Code to disregard the period from March 1, 2020, through 60 days after the announced end of the national emergency when determining certain periods and dates, including the election period for COBRA continuation coverage and the date for making COBRA initial premium payments.
These changes are a welcome acknowledgment by these entities that the huge societal upheaval caused by the pandemic has made meeting standard deadlines increasingly difficult. Feel free to contact one of our employment attorneys with any questions or concerns. Be well and stay safe.