COBRA Changes During the Pandemic

Is it possible for time to move fast while simultaneously standing still? We've had that feeling quite a bit over the past few months, and we expect many of you feel the same. The pandemic started roughly seven months ago, and at times we think to ourselves at Medcom, "where has the time gone? These months have flown by." But in the same breath, we also feel that surely it's been 10 years since February, and we can't believe we are still in the year 2020!

Regardless, we are still here, we are still in a pandemic, and we are still in a declared Nationally Emergency. Is there an end in sight?

Along with the rest of the country, we have no way of knowing when the National Emergency will end, but we do know it will affect your clients and employees. In May, we published a blog detailing COBRA, Time Extensions, and Coronavirus changes. Now, we want to revisit the changes made to COBRA and further discuss the Outbreak Period and its implications on your business. 

Then & Now

THEN - Pre-Outbreak Period: Under COBRA, employees and dependents who lose active coverage due to a Qualifying Event have 60 days to elect COBRA after receiving the notice sent by the employer. COBRA enrollees typically have 45 days after electing COBRA to make the first premium payment. 

NOW - Post-Outbreak Period: An individual who experiences a qualifying event has 60 days beyond the Outbreak Period to elect COBRA coverage, plus the extra 45 days to make the first payment. Also, premiums that are due during the Outbreak Period are not considered delinquent. The payment is not due until 30 days AFTER the Outbreak Period expires.

What is the Outbreak Period?

The Outbreak Period was established by the Department of Labor, The Treasury Department, and the IRS. It is a deadline extension providing plan participants, beneficiaries, and employers additional time to make critical health coverage decisions affecting benefits during COVID-19.  The Outbreak Period started on March 1 and ends 60 days after the National Emergency. 

At this time, the National Emergency is still in effect, and there is NO SET END DATE for the Outbreak period.

The challenge for employers and employees is the lack of understanding about handling some aspects of COBRA coverage. First, the Department of Labor issued no guidance regarding the Outbreak Period. We do know that employers are not responsible for paying premiums. However, practices by coverage carriers vary. Some carriers will not retroactively term the coverage after 60 days but will allow retroactive reinstatement of coverage. Other carriers will continue to provide coverage but will retroactively term after the 60 days. And after all that confusing language, the most we know is that employers and plan administrators are caught in the middle without any explanation from the DOL for participants.

What does this mean for us?

We are still in the dark, in the middle of a pandemic, without an end in sight for the Outbreak Period. In short, participants and employers must rely on their carriers for information. Contact them directly for guidance on their practices and plan for the eventual end of the National Emergency. The laws changed rapidly initially, and we should brace ourselves for more changes once the pandemic situation improves, and the National Emergency is over. The best policy moving forward is to make certain employers and employees track and document any actions taken. Employers must be willing and able to prove that all actions were made in good faith.

At any rate, Medcom will be here to provide as much information and assistance as possible to keep our benefits community informed. If you have questions regarding COBRA regulations, please email us